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Title: A question of growth rate Post by: nihilnegativum on April 29, 2015, 10:36:56 PM What do you think is the optimal change of rate of a currency? When you look at abstract value, of course everyone would opt for the exponential curve, but in reality, a less steep curve or a plateauing curve could better fit the actual growth of value and better represent the actual growth of value, while the exponential one would try to progress too fast and break, or perhaps it wouldn't even begin as it would start too slowly.
Of course for types of money that have their value determined only and immediately by market, the graph of diminishing returns becomes useful to conserve and increase value and reward early investors, but when we have other options, I don't think its the best solution. In the long run diminishing returns, established by increasing difficulty, has too many problems (lack of incentive for newcomers & centralization are two major ones). Perhaps a flat linear graph would be better for stability. Diminishing returns Additional money supply means less and less percent of the value of total money supply. Initial growth is faster than future growth. Graph example: https://i.imgur.com/SdJUWQn.png Increasing returns Additional money supply means more and more of the value of total money supply. Initial growth is slower than future growth. Graph example: http://conspiracyparadigm.com/wp-content/uploads/2012/09/exponential-growth-graph-1.gif Linear growth Additional money supply means the same percent of the value of total money supply. Graph example: https://i.imgur.com/lJwGdh5.png If any alts already experimented with exponential growth and linear growth, please link them below. |
