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The last paragraph is absolutely peak "let cryptocurrency run long enough and they invent every institution they tried to get rid of". What the author is descr
by Barrin92 2y ago
The last paragraph is absolutely peak "let cryptocurrency run long enough and they invent every institution they tried to get rid of".
What the author is describing here, a trusted group of institutions that buy and sell currency to maintain an inflation target is called a 'central bank'. Or in this case, a bunch of central banks. In fact even the proposal to automate and do this algorithmically goes back to Friedman.
- wmf 2y agoA decentralized and credibly neutral central bank is good actually.
- pcthrowaway 2y agoIn fact, I think there are numerous stablecoins whose peg is maintained through mechanics typically associated with central banks, which have been decentralized. Some (Maker DAO's DAI for example) have been holding at +/- 0.2% of peg, 99.9% of the time, for years.
- gary_0 2y agoWouldn't multiple central banks (each with their own currency) be the best? Or is that what you mean? Then people can choose which currency (and thus which central bank) seems the most stable and legitimate (as long as it can also exchange with the currency they pay their rent and taxes in). (Theorizing about cryptocurrency is fun as long as you ignore how actually-existing crypto, like actually-existing communism, is working out in the real world. Although that doesn't mean all the underlying principles are wrong...)
- wmf 2y agoYes, each currency should have its own central bank.
- ocean_moist 2y agoi agree. although the centrality/instuitionality of the “bank” is negated. the “central” bank is completely decentralized and completely dependent/reactionary to the market. the idea is old but gains new life to the rise of defi.