Can a coin that is primarily a store-of-value succeed?

[jjacob]

why don't you use a bitcoin service that locks your bitcoins value? that way you get a store of value with bitcoin

i can't recall any service like that, and it could potentially go against the bitcoin decentralization, because a service like that will probably be centralized...

Hedged accounts are here now. 
https://support.coinjar.com/hc/en-us/articles/204157605

[odolvlobo]

why don't you use a bitcoin service that locks your bitcoins value? that way you get a store of value with bitcoin

i can't recall any service like that, and it could potentially go against the bitcoin decentralization, because a service like that will probably be centralized...

There are a few. This is probably the most well-known: https://coinapult.com/locks/info

[iGotSpots]

That was the goal with MMXIV. To provide a hedge using high stake rates. It's going alright

[Q7]

Yes it can. DMD Diamond s primairly store of value and it s going to be big. Yes, I have invested in it and yes you can consider this as a promotion. However, if I think it s smart to invest my own money in it, I see no reason why I would not recommend it to other people.

Okay, you're free to promote a coin you like, but in keeping with this being the bitcoin discussion section, would you mind elaborating why you think such coins can/will succeed? You're free to bring examples from your coin, but I hope that there is also something in general to all cryptocurrencies. I don't mind the mods moving this thread, but I'd prefer if it stayed here.

Thanks.

Ok, sure.


You know how they often compare crypto to a gold?

One of the major function of gold is to be a store of value, in other words a precious metal you can turn your assets into and know that you ll be able to retain that value over decades.
The same idea s behind several cryptocurrencies, I would say most of them besides those with high inflation rate e.g 700%+

People often think that the primary reason for crypto to succeed is to get accepted by thousands of small retailers and get spent EVERY DAY. This might not be true.
I personally chose my currencies to act as store of value, I do use some of them to purchase things I need but most of them I hoard like a hamster. Let us be honest, most of us do the same.
The only difference is that some people do it solely because they expect the price of their portfolio to apprecaiate while other, like me, do this due to this additional reason of PRESERVING current assets over time.

I like gold but I m into tech and I need something with characteristics of a precious metal which can be turned into FIAT fast, which is easy to transfer, which is safe and secure.

Why DMD Diamond? Well, its a 50% annual PoS coin. In other words, it s a gold bar which generated small gold bars over time.  
Also, it s a coin with a very limited and scarce supply as a real diamond should be. PoW phase reward just got reduced from 1 DMD per block to 0.2 DMD per block.

So, yes, I believe crypto can be used as a store of value. Whether this is its primarily function, it depends on the person who holds it.

If you create a coin primarily only for as a storage purpose  how do you expect it to grow without demand. If you can create a coin and slap it with any name you want to call it what prevents others from doing the same and call their coins also as store of value. What makes the difference here is if you can create a coin where there is a natural demand for spending purpose it will likely attain a value. Never mind if it gets sold as long as people will buy it again and spending the coins is the key.

[cbeast]

Store-of-value was programmed into us by the Scientology Overlords so they might easily take our gold when they return. Bitcoin is a secret weapon created on the Planet Satoshi to defeat the Scientologists. 

[Lorenzo]

So if bitcoin becomes a primarily store-of-value coin, or if an altcoin that pops up in the future decides to make itself primarily for the use of storing value, will the amount of transactions be able to support miners, when the block reward drops off, and only transaction fees are left? If not enough transactions happen, what will happen to the network security? Will the big players spend their own money to secure the network to make sure the value they have in the coin is safe? Or will transaction fees be very high? Or will the network be vulnerable?...

...Also, if an altcoin is too inflationary, obviously it won't work well as a store of value. But perhaps a small amount of inflation could work; if we could estimate the amount of coins lost (through mistakes, death, or whatever else) per year, and have the emissions match that amount, we are essentially keeping the amount of coins constant (or close to it). Miners will still get rewards, and we won't end up with a grand total of 1 satoshi that isn't lost, from 21mil coins in the future.

I'm surprised to see that Peercoin hasn't already been mentioned yet. Peercoin was designed to be a store of value coin from the very beginning by Sunny King. His suggestion was that PPC should be used as a savings account or a "backbone currency". It's security model is proof-of-stake although the distribution uses an initial proof-of-work stage.

One of the measures he implemented to make sure that PPC is fit for this role was fixed transaction fees which don't go to miners/stakers but are simply destroyed and lost forever. In order to encourage staking, the coin incorporates a fixed 1% per year inflation rate instead. Hence Peercoin completely dissolves the link between transaction fees and mining/staking incentives. This means that even with very few transactions happening, PPC can still have a healthy network.

Note that this also means that PPC isn't really the type of coin that you'd use to buy your baked beans at the supermarket with.