A totaly stable economic foundation

stan.distortion

Well-known Member
Oct 30, 2014
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Just supposing such a thing was possible, something that meant your savings today would be worth exactly the same in a hundred years time, would there be much demand? I mean, I don't mind the ups and downs of cryptocurrency but it's often pointed to as a hindrance to adoption, is that really true or just a catchy headline?

Also, could there be any negative consequences to something like that, anything that could become unstable as a consequence for example?

Thanks.
 

stan.distortion

Well-known Member
Oct 30, 2014
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I don't see how this could be achievable.
What would even be the reference point for this?
Good question but one I was trying to avoid by posting in general, it would really be an altcoin discussion so I was only looking at the desirability and potential consequences rather than how something like that would actually work.
 

Tallyho

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Mar 15, 2015
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so you mean it would keep the same buying power? So if 1 coin would buy you a dozen eggs today 1 coin would still buy a dozen eggs in 2117? There would be no incentive to hold or accumulate, so I guess in that sense it might help keep the coins circulating, but there's no incentive for merchants either. They wouldn''t be able to increase their prices to support their increasing overheads because the currency would simply revalue to absorb their price increase. Actually I can see an infinite loop forming here.

In the real world nothing stays the same value, it never has. Costs and assets increase, legal tender decreases. I think Dash has a pretty good shot at achieving stability by being both a currency and an asset, but part of the see-saw system is that it keeps people interested, whether the buyers or the sellers. Stability in the form of sameness holds no interest for either side of a trade.
 

stan.distortion

Well-known Member
Oct 30, 2014
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so you mean it would keep the same buying power? So if 1 coin would buy you a dozen eggs today 1 coin would still buy a dozen eggs in 2117? There would be no incentive to hold or accumulate, so I guess in that sense it might help keep the coins circulating, but there's no incentive for merchants either. They wouldn''t be able to increase their prices to support their increasing overheads because the currency would simply revalue to absorb their price increase. Actually I can see an infinite loop forming here.

In the real world nothing stays the same value, it never has. Costs and assets increase, legal tender decreases. I think Dash has a pretty good shot at achieving stability by being both a currency and an asset, but part of the see-saw system is that it keeps people interested, whether the buyers or the sellers. Stability in the form of sameness holds no interest for either side of a trade.
Lol, it's a tricky problem :) Yes, something with the same buying power, ie. a dozen eggs today would still be worth the equivalent in 100 years. If the overheads of producing eggs are the same then still a dozen, if they're lower then more, if we're growing them in vats at that stage then bring a wheelbarrow!

I don't think it's possible by directly integrating with the regular economy btw, as far as I can see it could only work for savings via conversion. Easy enough to make it spendable, just do the conversion on the fly but it could only be spendable directly with something also linked to a solid point of reference.

That's why that second question, could it have any negative consequences? For example, just supposing you had a solid point of reference then would there be any need for a free market establishing prices? There probably would for most things, creativity can't have a fixed price for example but if you knew exactly what was needed to produce those dozen eggs then their value is already established.
 

TheSingleton

Active Member
Masternode Owner/Operator
Mar 27, 2017
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Something like this is just not possible. You could at maximum create a token that always has the same value as a fixed quantity of something else. That other thing could be dollars gold or maybe a dozen eggs. Though eggs would be horrible as they are not a liquid store of value and they are not all interchangeable which would likely be needed for the price finding mechanism.

So there only really use-case I see here is using a Fiat Currency as the reference point and then add a 2% or something value increase to counteract the inflation in your reference currency. If you could somehow use multiple Fiat Currencies as a reference point so one failing won't cause issues and also have the counter inflation be dynamic then you would be very close to what you imagine. But that seems rather hard.

And I can see something like that being useful. While we might not mind the up's and downs others might. For example, very poor people with no access to banking that want to use crypto probably can't afford to lose 20% of their value during a short period. Also merchants especially bigger ones currently rather sell their crypto back to fiat because they value stability. So yes I think something like that could be useful for adoption but I don't think it is necessary.
 

stan.distortion

Well-known Member
Oct 30, 2014
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I'm going to have to explain it aren't I? I wouldn't blame UdjinM6 for booting this into alts, the trashcan or off the interwebs altogether as part of it would interfere with the emission rate.

Ok, the petrodollar... A great invention at the time, we use huge amounts of energy so base an economy on the huge energy source that enabled it. Fast forward and it didn't work out so well, that huge energy source is depletable and it's only available in certain locations but the principle is sound so can the bugs be ironed out?
Well where does oil come from? We treat it as free, the cost only begins with extraction but that's not exactly true, it started out as organic matter and the energy for that originally came from the sun, just the same as any other sensible energy source, so how about using that?

That works out well, it turns out the cost of just about anything organic can be worked out in those terms, the chicken and the egg, it's just a matter of science and it gives a strong incentive for energy efficiency but there's a problem... Oil as fuel is horrendously expensive, the best figures available are 98 tons of biomass for every gallon of fuel oil so you can't interact directly with the foundation of the petrodollar economy, you'd need to spend billions of gallons of hydropower just to fill up the car.

It could be used for a renewable energy economy but there would be no incentive, not initially at least but that's just one option, anything that needed a lot of energy to produce would have a strong link and anything that needed just energy would be ideal, mining a cryptocurrency for example. That's the link, the energy cost to produce a coin, it naturally follows the dollar cost but it has a direct link to the energy used.

The most straightforward way I could see of doing that is destroying one to create the other at the current cost, ie. exchanging coins with a dollar value for units based on the energy used to create them and vis versa but maybe there are other ways. It could be given a dollar value but in terms of oil it would be practically worthless, as savings it would be worth the same for as long as the sun keeps shining.

EDIT: The reference for that 98 ton per gallon figure, not dug out the original paper yet:
https://archive.unews.utah.edu/news_releases/bad-mileage-98-tons-of-plants-per-gallon/
 
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