4 ms·
These currencies will inflate in value as their network grows wider. Each new user adds value like a telephone network. Eventually, there will be a point where
by scsilver 6y ago
These currencies will inflate in value as their network grows wider. Each new user adds value like a telephone network. Eventually, there will be a point where everyone who wants to be connected is connected, they have bought the bitcoin they want and bitcoin prices reach an steady state. At that point, it should be stable enough to use as a currency.
- PragmaticPulp 6y agoIt’s fascinating to watch MLM logic sweep the tech world. Get in on the ground floor of this opportunity, then convince all of your friends to buy in, then they convince all of their friends... Once the speculation upside is gone, why would anyone want to buy Bitcoin? That’s the real question.
- centimeter 6y agoMLM dynamics actually do apply to monetized assets in some cases. Cf. “Bubble Theory Of Money”, Gresham’s Law. Once the speculation upside is gone, you would use Bitcoin because it’s the best available reserve and settlement asset. What are your other options? Inflationary USD or Yuan? Few rational actors would prefer to hold those.
- ForHackernews 6y ago> Inflationary USD lolz https://www.macrotrends.net/countries/USA/united-states/inflation-rate-cpi https://www.macrotrends.net/countries/USA/united-states/infl...
- centimeter 6y agoCPI is a joke of a metric. Very few economists take it seriously.
- ForHackernews 6y agoWhat metric would you prefer?
- trhway 6y agomy favorite is M3 https://fred.stlouisfed.org/series/MABMM301USM189S https://fred.stlouisfed.org/series/MABMM301USM189S Edit: I thought it was obvious, yet in response to comment below - theoretically to get real inflation one has to adjust the M3 for the growth of the total amount of "stuff" in the economy. As that growth is just 1-2%/year , the M3 shape is visually indistinguishable from the real inflation on any given time period of up to several years.
- ForHackernews 6y agoThat's not a measure of inflation, it's just a measure of money supply.
- georgeplusplus 6y agoinflation is defined as expansion or contraction in the money supply
- ForHackernews 6y agohttps://www.investopedia.com/terms/i/inflation.asp https://www.investopedia.com/terms/i/inflation.asp > Inflation is the decline of purchasing power of a given currency over time. https://www.economicshelp.org/macroeconomics/inflation/definition/ https://www.economicshelp.org/macroeconomics/inflation/defin... > A more exact definition of inflation is a sustained increase in the general price level in an economy. Inflation means an increase in the cost of living as the price of goods and services rise. https://www.economicsonline.co.uk/Definitions/Inflation.html https://www.economicsonline.co.uk/Definitions/Inflation.html > Inflation refers to a rise in the average level of prices sustained over time, which also corresponds to a fall in the internal (domestic) purchasing power of money.
- PragmaticPulp 6y ago> What are your other options? Inflationary USD Investors don't have to choose between investing in Bitcoin or parking their money in cash. The stock market, real estate, commodities, and other assets don't lose their value if USD inflates. The narrative that the only two choices are to buy Bitcoin or lose out to inflation is a fiction designed to convince people to buy more Bitcoin. Bitcoin isn't the only investment option. > Inflationary USD or Yuan? Few rational actors would prefer to hold those. Evidence suggests otherwise.
- scsilver 6y agoIts not MLM its network effects. Every node added to a transactional network adds real world value to that network. Its etreamly evident in telephone networks. The reason people would want to buy bitcoin once it has grown out of its speculation is the vast marketplace of people and vendors who accept bitcoin as tender + the use of bitcoin as a hedge against the inflation of your local fiat currency. It becomes another investment vehicle to diversify with.