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> Will governments around the world begin to make their currency deflationary in order to make it attractive? rofl If you want people to use currency more, you make it inflate faster. This guy does not understand macroeconomics.
thank you. I'm glad I'm not the only one who feels this article doesn't properly understand the intricacies of inflation/deflation in an economy
I was hoping this article was going to be a serious look at if an AI could run on a currency like Ethereum. A few months back I wrote a tongue in cheek version about if the DAO hack was to prevent the singularity [1]. But I'd be curious if it were actually possible. 1. http://arthur-johnston.com/essay/2016/06/26/Rokos_DAO.html
This is full of misunderstandings about monetary policy. Currencies that are not designed to lose value over time can not be stable. Intrinsically worthless tokens engineered to have better than market risk adjusted, liquidity adjusted, real returns compared to real productive investment will always be unstable and fluctuate increasingly wildly as they get more popular. This is a result of physical limits of producti…
If I understand this right, I don't think I necessarily disagree with you. My question is: if people can choose one or the other to spend, what do you think they'll choose? A currency that inflates quickly, or one that inflates less quickly?
Like most investments there will be a trade-off of risks vs returns but both currencies will in the long run, be poor investments compared to income generating assets tied to real production.
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thank you. I'm glad I'm not the only one who feels this article doesn't properly understand the intricacies of inflation/deflation in an economy
Yes, I certainly can't say I'm an economics expert. Mind sharing with me what part of the article you think is misguided?
Honestly, I'm kind of scared/surprised more people aren't talking about this.
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I thought the same thing, the core idea of this article is in direct opposition of its conclusion. Bitcoin is going up in value, and according to the market predictions it will go way higher, so it's deflationary. Bitcoin holders will prefer to spend cash money to bitcoins anytime in speculation of future gains. I see bitcoin more of a speculative investment at the moment, than a type of currency. Only the ones that…
Bitcoin seems like an investment in proving the ideas that may eventually come to form a truly practical cryptocurrency.
Just as an example: I don't see why the US government couldn't adopt the best parts of crypto (e.g. the public ledger) but also be able to control it and how that kind of move wouldn't make it instantly the most trusted cryptocurrency vs all the ones we speculate on today.
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Yes, I certainly can't say I'm an economics expert. Mind sharing with me what part of the article you think is misguided?
Yes. I posted my thoughts in another comment > https://news.ycombinator.com/item?id=15184382 Honestly, I'm kind of scared/surprised more people aren't talking about this.
What I'm trying to say is that if people have a choice, they'll keep their wealth in a currency that destroys their wealth the least slowly. This, I suspect, will have a runaway effect. We probably wouldn't be able to stop it if we tried, which sounds a lot like the AI singularity.
Excellent writeup! I came to the same conclusion a few years ago with Thiers' Law: good money drives out bad, http://nakamotoinstitute.org/mempool/speculative-attack/
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Bitcoin seems like an investment in proving the ideas that may eventually come to form a truly practical cryptocurrency.
Yes. Thank you. I honestly feel like it is a solution seeking a problem. Not to say it isn't solving any problems already, but I think it's still seeking a big enough problem that the general public starts paying attention and believing in its value. Just as an example: I don't see why the US government couldn't adopt the best parts of crypto (e.g. the public ledger) but also be able to control it and how that kind o…
Earlier quoted context omitted.
If I understand this right, I don't think I necessarily disagree with you. My question is: if people can choose one or the other to spend, what do you think they'll choose? A currency that inflates quickly, or one that inflates less quickly?
I think market forces will make it so that the one that inflates less quickly will be more volatile and the higher risk premium of holding it will make it often less attractive than the one that inflates more quickly but often it also will be the opposite. Like most investments there will be a trade-off of risks vs returns but both currencies will in the long run, be poor investments compared to income generating ass…
I don't think gold is the right medium for the singularity because it is not easy to obtain and subdivide. It needs to be in the the vicinity of choosing the inflated coin on one hand, and the more valuable coin on the right.
Perhaps it's this trait that will keep Bitcoin volatile? Because it's easy to go in and out of it, volatility will remain high?