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The false premise you're using is that smart contracts provide more utility than sound economic policy does.
by beaner 6y ago
The false premise you're using is that smart contracts provide more utility than sound economic policy does.
- downandout 6y agoI don’t think that “sound economic policy” would, for example, have major banks offering flash loans. There are many things that can only be achieved through decentralization. Policymakers and banks alike have a serious interest in remaining gatekeepers, and would never enable many of the DeFi functions.
- socialentity 6y agoOn the other hand, if flash loans are not sound economic policy, doesn't that imply they won't prevail? Evolution will weed them out.
- brighton36 6y agoHow does sound economic policy differ from visual economic policy?
- DennisP 6y agoSo what happens after Ethereum finishes migrating to proof of stake and has lower inflation than Bitcoin?
- beaner 6y agoThe problem is not what the inflation rate is at any given moment, but that it can be changed so easily, like the very switch to ETH 2 is an example of. The inflation curve in Bitcoin is considered sacred. In Ethereum, it's developer whim and EIP approval.
- nootropicat 6y agoIt was known from the start that the PoW phase is just a temporary development phase, with no parameters set in stone. Eth2 has a deterministic inflation schedule that depends on total amount of stake. def calc_annual_reward(total_staked_eth): return math.exp(31556926 / 384 * 64 / 31622 / total_staked_eth ** 0.5) - 1 This is the return rate for validators - this should be multiplied by the average online percentage, eg. 0.9 if average participation is 90%. On top of that comes fee burning, which is inherently variable, but likely to lead to deflation at least initially. Extrapolating fees from the last 24 hours and assuming 10M eth is staked, the net result is a deflation of 1.3%.