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Another thing I feel would be a flaw is the inability to increase and decrease the money supply - something central banks often do with fiat money to stimulate

Another thing I feel would be a flaw is the inability to increase and decrease the money supply - something central banks often do with fiat money to stimulate the economy. Most crypto currency seem proud even that they can only deflate … which is the worst thing for a currency since it will just result in hoarding and ever decreasing economic activity (AKA deflationary spiral) - at the end of the day, economic activity is what we want, it’s what put food on supermarket shelves, we can’t eat money.

acjohnson55 5y ago
The goal is not really to stimulate the economy, but to make sure there is the appropriate amount of money for the amount of economic activity, so that prices are driven by supply and demand of goods and services, but not so much by the constraints of the monetary system, itself. If you get this wrong, you have price instability. Money should be the most boring part of the economy. It's just the medium. This is what crypto gets wrong. In crypto, the money is the entire economy.
Valakas_ 5y ago
For the economy to be stimulated through increase of supply, everyone has to lose some purchasing power. Is that a good trade-off? I don't know.
boogies 5y ago
> Another thing I feel would be a flaw is the inability to increase and decrease the money supply - something central banks often do with fiat money to stimulate the economy. Preventing that type of manipulation might actually be the motivation for Bitcoin's creation. Satoshi embedded the text "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks" into the first coinbase in the blockchain¹. Inflation is a tax on savings that similarly benefits the money manipulators at the expense of common people with less control of the currency. ¹https://en.wikipedia.org/wiki/Bitcoin#Creation https://en.wikipedia.org/wiki/Bitcoin#Creation

acjohnson55 5y ago

The goal is not really to stimulate the economy, but to make sure there is the appropriate amount of money for the amount of economic activity, so that prices are driven by supply and demand of goods and services, but not so much by the constraints of the monetary system, itself. If you get this wrong, you have price instability. Money should be the most boring part of the economy. It's just the medium. This is what crypto gets wrong. In crypto, the money is the entire economy.

Valakas_ 5y ago

For the economy to be stimulated through increase of supply, everyone has to lose some purchasing power. Is that a good trade-off? I don't know.

boogies 5y ago

> Another thing I feel would be a flaw is the inability to increase and decrease the money supply - something central banks often do with fiat money to stimulate the economy. Preventing that type of manipulation might actually be the motivation for Bitcoin's creation. Satoshi embedded the text "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks" into the first coinbase in the blockchain¹. Inflation is a tax on savings that similarly benefits the money manipulators at the expense of common people with less control of the currency. ¹https://en.wikipedia.org/wiki/Bitcoin#Creation https://en.wikipedia.org/wiki/Bitcoin#Creation