5 ms·

All those changes took years to make happen and hundreds of people debated them. All of them have made Ethereum more secure, easier to use, and deflationary.

lmm 4y ago
> All those changes took years to make happen and hundreds of people debated them. Sure. But if you want a money system whose policy is based on, well, politics, we already have plenty of very good implementations of those. > All of them have made Ethereum more secure, easier to use, and deflationary. It's too young to say if it's actually deflationary or not. I'm betting on not, because once there is more value leaving the crypto ecosystem than entering it, no force on Earth can stop that from lowering crypto values.
- TimJRobinson 4y ago
  It's deflationary not in a USD sense but that over time there is less and less ETH because it's being burnt. While almost every other token is printing more. It's not politics, it's discussing technical and economic tradeoffs to make the most secure credible neutral decentralized ledger possible. There are some Bitcoin maximalists that think Satoshi was a god who figured everything out perfectly from inception. To me their insistance on never changing seems more religious than technical. Arguing that an inflationary money is actually a better store of value than a deflationary one is not possible from an economic standpoint so they have to switch to other arguments like "well yea the devs continually made the economics better... But what if they make them worse!" Which isn't based in reality, it's all FUD. There are no further plans to change the economics beyond this point and attempting to change them requires convincing thousands of people that it's a good idea, and it's not a 50% quorum, it's 90%+ because there are many clients written by many different teams that would all have to implement the change.
  - amarant 4y ago
    Inflationary money IS better than deflationary money though. Deflationary money encourages hoarding, and discourages investment in value-producing ventures. Inflationary money does the opposite. If society ran on deflationary money, that would act as a massive brake on the economy, and financial institutions would become risk-averse to the point where loaning money would be nigh on impossible. Deflationary money is only better from a hoarding perspective, and I'd argue that perspective is counter productive for society as a whole.
    - sph 4y ago
      Inflationary currency benefits the wealthy though. If you are rich, you can get loans easily, and it's better to invest your liquid cash and get cheap money on loan, while everybody else has a constantly deflating account. So you get even wealthier. A loan can be seen as a short on the currency. When you take out a loan, you bet that the currency tomorrow will be worth less than today. Which is what happens in an inflationary world. It would not be a problem if everybody could get a loan, but usually loans are directly proportional to wealth. tl;dr: inflationary = good for wealthy people, accumulates money in the hands of the few. Spending is encouraged. Deflationary = good for regular people, companies are loath to invest. Saving is encouraged. There is no free lunch.
      - nradov 4y ago
        That is an ahistorical take. Deflationary periods have not generally been good for regular people.
        survirtual 4y ago
        Historically, we have not had worldwide light speed communication available to all, and deflationary currency transmissible at lightspeed absent any central authorities. I think we can take history with a grain of salt here.
        amarant 4y ago
        While I agree that the internet has a huge impact on the economy, I don't think there's reason to believe it changes it in the way you seem to imply. In the absence of any very convincing argument to the contrary, the historical view seems very likely to be correct. Pray tell, how do you mean the internet would make deflation favour the poor? I fail to see any mechanic or theory that would support the notion.
  - kaashif 4y ago
    > It's deflationary not in a USD sense but that over time there is less and less ETH because it's being burnt. This isn't what the word deflation actually means though. Deflation is when the purchasing power of a currency increases, and inflation is the opposite. The purchasing power of ETH hasn't been very stable over time at all. It certainly hasn't been consistently deflationary.
  - scotty79 4y ago
    > There are some Bitcoin maximalists that think Satoshi was a god who figured everything out perfectly from inception. To me their insistance on never changing seems more religious than technical It's not about getting it perfect. It's about getting it good enough and stable. Bitcoin had its forks that introduced change. People voted with their legs and chose the stability. What matters is that some developers attempted a change and ultimately people decided they prefer original set of rules. Not sure what happened with ETH but I feel like it might work a bit differently there.
    - TimJRobinson 4y ago
      I can see merit to that, as it's trying to be a good money more than Ethereum, and nation states won't adopt a currency with technical risk. I just think it ossified way too early and then to justify that they come up with religious arguments that "actually 21m coins on a diminishing curve is the perfect economic policy and any meddling is bad"
      - scotty79 4y ago
        Sure, but it ossified at the behest of its community who could have chosen more progressive forks but decided not to. Given how well bitcoin is doing it wasn't a bad call. And if someone doesn't like what bitcoin is (not) doing there's plenty of other cryptos they can move to. So far no crypto seemes to be able to win the holy grail for mass business adoption and it's really hard to tell which one can manage that if any
  - aserafini 4y ago
    Even if no change could ever be made again to Bitcoin: it is not an inflationary money in the long term. Only during the current predictable and necessary bootstrapping phase where there still exists a block reward (until ~2140) is the total circulating supply gradually increasing. After this point it is neither inflationary or deflationary for supply reasons (although as people lose coins it may be very slightly deflationary).
  - xorfish 4y ago
    Changes in money supply are not the same as inflation or deflation.
  - yywwbbn 4y ago
    Deflationary money would be a pretty bad thing. Good thing ETH is not money. It might potentially be a good asset to store value in, sure
  - Jorge1o1 4y ago
    >Arguing that an inflationary money is actually a better store of value than a deflationary one is not possible from an economic standpoint See Krugman’s legendary article about the problem with deflationary currencies, such as the one used by the Capitol Hill Babysitting Co-op. Long story short, he claims that people will hoard their deflationary currency because they expect it to go up in value over time. But if a large percentage of economic actors are hoarding their currency, there will be less economic activity and less output, and paradoxically, the value of the currency will go down rather than up.
  - Miraste 4y ago
    >It's not politics, it's discussing technical and economic tradeoffs to make the most secure credible neutral decentralized ledger possible. Who decided which tradeoffs are best? How did they get other people on board? This certainly sounds like politics.
    - RestlessMind 4y ago
      If enough people are not on board, the majority can always fork and have their own chain. The best implementation then wins in the long run. That is the beauty of blockchains, imho. It happened once with ETH vs ETC. BTC has been subjected to numerous shit-forks. Real valuable chain has persisted in all the cases.
- deleted 4y ago
  [deleted]
raverbashing 4y ago
I agree And this is quite the opposite of other maincoins, which don't change while grinding its gears But hey isn't it fun to have a system that gets slower the more people are using it?
cflynnus 4y ago
It's not good money if it's properties can be changed, especially it's supply.
- kaashif 4y ago
  In that case, literally nothing is good money. I'm not sure that's a good definition of good money.

lmm 4y ago

> All those changes took years to make happen and hundreds of people debated them. Sure. But if you want a money system whose policy is based on, well, politics, we already have plenty of very good implementations of those. > All of them have made Ethereum more secure, easier to use, and deflationary. It's too young to say if it's actually deflationary or not. I'm betting on not, because once there is more value leaving the crypto ecosystem than entering it, no force on Earth can stop that from lowering crypto values.

TimJRobinson 4y ago
It's deflationary not in a USD sense but that over time there is less and less ETH because it's being burnt. While almost every other token is printing more. It's not politics, it's discussing technical and economic tradeoffs to make the most secure credible neutral decentralized ledger possible. There are some Bitcoin maximalists that think Satoshi was a god who figured everything out perfectly from inception. To me their insistance on never changing seems more religious than technical. Arguing that an inflationary money is actually a better store of value than a deflationary one is not possible from an economic standpoint so they have to switch to other arguments like "well yea the devs continually made the economics better... But what if they make them worse!" Which isn't based in reality, it's all FUD. There are no further plans to change the economics beyond this point and attempting to change them requires convincing thousands of people that it's a good idea, and it's not a 50% quorum, it's 90%+ because there are many clients written by many different teams that would all have to implement the change.
- amarant 4y ago
  Inflationary money IS better than deflationary money though. Deflationary money encourages hoarding, and discourages investment in value-producing ventures. Inflationary money does the opposite. If society ran on deflationary money, that would act as a massive brake on the economy, and financial institutions would become risk-averse to the point where loaning money would be nigh on impossible. Deflationary money is only better from a hoarding perspective, and I'd argue that perspective is counter productive for society as a whole.
  - sph 4y ago
    Inflationary currency benefits the wealthy though. If you are rich, you can get loans easily, and it's better to invest your liquid cash and get cheap money on loan, while everybody else has a constantly deflating account. So you get even wealthier. A loan can be seen as a short on the currency. When you take out a loan, you bet that the currency tomorrow will be worth less than today. Which is what happens in an inflationary world. It would not be a problem if everybody could get a loan, but usually loans are directly proportional to wealth. tl;dr: inflationary = good for wealthy people, accumulates money in the hands of the few. Spending is encouraged. Deflationary = good for regular people, companies are loath to invest. Saving is encouraged. There is no free lunch.
    - nradov 4y ago
      That is an ahistorical take. Deflationary periods have not generally been good for regular people.
      - survirtual 4y ago
        Historically, we have not had worldwide light speed communication available to all, and deflationary currency transmissible at lightspeed absent any central authorities. I think we can take history with a grain of salt here.
        amarant 4y ago
        While I agree that the internet has a huge impact on the economy, I don't think there's reason to believe it changes it in the way you seem to imply. In the absence of any very convincing argument to the contrary, the historical view seems very likely to be correct. Pray tell, how do you mean the internet would make deflation favour the poor? I fail to see any mechanic or theory that would support the notion.
- kaashif 4y ago
  > It's deflationary not in a USD sense but that over time there is less and less ETH because it's being burnt. This isn't what the word deflation actually means though. Deflation is when the purchasing power of a currency increases, and inflation is the opposite. The purchasing power of ETH hasn't been very stable over time at all. It certainly hasn't been consistently deflationary.
- scotty79 4y ago
  > There are some Bitcoin maximalists that think Satoshi was a god who figured everything out perfectly from inception. To me their insistance on never changing seems more religious than technical It's not about getting it perfect. It's about getting it good enough and stable. Bitcoin had its forks that introduced change. People voted with their legs and chose the stability. What matters is that some developers attempted a change and ultimately people decided they prefer original set of rules. Not sure what happened with ETH but I feel like it might work a bit differently there.
  - TimJRobinson 4y ago
    I can see merit to that, as it's trying to be a good money more than Ethereum, and nation states won't adopt a currency with technical risk. I just think it ossified way too early and then to justify that they come up with religious arguments that "actually 21m coins on a diminishing curve is the perfect economic policy and any meddling is bad"
    - scotty79 4y ago
      Sure, but it ossified at the behest of its community who could have chosen more progressive forks but decided not to. Given how well bitcoin is doing it wasn't a bad call. And if someone doesn't like what bitcoin is (not) doing there's plenty of other cryptos they can move to. So far no crypto seemes to be able to win the holy grail for mass business adoption and it's really hard to tell which one can manage that if any
- aserafini 4y ago
  Even if no change could ever be made again to Bitcoin: it is not an inflationary money in the long term. Only during the current predictable and necessary bootstrapping phase where there still exists a block reward (until ~2140) is the total circulating supply gradually increasing. After this point it is neither inflationary or deflationary for supply reasons (although as people lose coins it may be very slightly deflationary).
- xorfish 4y ago
  Changes in money supply are not the same as inflation or deflation.
- yywwbbn 4y ago
  Deflationary money would be a pretty bad thing. Good thing ETH is not money. It might potentially be a good asset to store value in, sure
- Jorge1o1 4y ago
  >Arguing that an inflationary money is actually a better store of value than a deflationary one is not possible from an economic standpoint See Krugman’s legendary article about the problem with deflationary currencies, such as the one used by the Capitol Hill Babysitting Co-op. Long story short, he claims that people will hoard their deflationary currency because they expect it to go up in value over time. But if a large percentage of economic actors are hoarding their currency, there will be less economic activity and less output, and paradoxically, the value of the currency will go down rather than up.
- Miraste 4y ago
  >It's not politics, it's discussing technical and economic tradeoffs to make the most secure credible neutral decentralized ledger possible. Who decided which tradeoffs are best? How did they get other people on board? This certainly sounds like politics.
  - RestlessMind 4y ago
    If enough people are not on board, the majority can always fork and have their own chain. The best implementation then wins in the long run. That is the beauty of blockchains, imho. It happened once with ETH vs ETC. BTC has been subjected to numerous shit-forks. Real valuable chain has persisted in all the cases.
deleted 4y ago
[deleted]

raverbashing 4y ago

I agree And this is quite the opposite of other maincoins, which don't change while grinding its gears But hey isn't it fun to have a system that gets slower the more people are using it?

cflynnus 4y ago

It's not good money if it's properties can be changed, especially it's supply.

kaashif 4y ago
In that case, literally nothing is good money. I'm not sure that's a good definition of good money.