I’m probably wrong too but I think
Bitcoin is best
Monero is second best
Discussion
Monero is pretty cool. If monero could cap emissions like Bitcoin, I would love it. I know the “inflation is controlled and just a bit a year”, but inflation is the root of all evil. Well, inflation in the hands of a few, like today, via governments.
To me it doesn’t matter we already have bitcoin which is capped and works great, what it lacks is good layer 1 privacy which is the focus of Monero. As long as bitcoin doesn’t have good layer 1 privacy, Monero or something like it will need to fill the gap.
popular misconception, gold has supply inflation.
theres nothing wrong with it, its not unethical or whatever.
and it makes for better money to have low, known supply inflation.
I see you say this a lot, and I respect you, but I haven't heard a good argument for why any inflation has value. What is the utility of any inflation if you have an infinitely divisible non-inflationary alternative?
it isnt optimal to split the value of all economic growth over all the holders of the money
why should anyone take on the risk of investment if they can reap the rewards of *other people's* risk simply by holding the money?
ideally we would have the money supply track with economic growth and purchasing power/prices would be basically constant.
but theres no way to do that trustlessly, so low, linear inflation is the way to go
How they can reap the rewards just by holding? They can’t. They will be at risk constantly. This is why many people leaves crypto to begin with. First they think they will make easy money, then, in matter of hours, crypto goes down 2-7%, what do they do? Bounce off of it.
I still believe your second argument is not correct, because it doesn’t consider deflation.
We're talking about economics under a Bitcoin standard
But this presumes that people participating in the same economic network shouldn't benefit from the productivity of the network based on a further presumption that this would prevent investment. We already have numerous examples of investment funds that specifically take into account the hurdle rate of bitcoin when determining whether to invest or not. I dont think either of the previous presumption are axiomatic. In fact, I think devaluing the money to spur investment is exactly the problem. For example, if you impose 2% inflation, all you're doing is modifying down the hurdle rate organically established by the growth of the economic system proportionally. It's exactly the same thing just inorganically modified by an inflationary policy. To me this is just arbitrary.
but its not the same because you allow for economic expansion by lowering the hurdle rate.
If you have an *only deflationary environment (as under a capped money standard) you incentivize hodling. Its just a fact, we already see why.
But sure, the inflation rate is arbitrary. Lacking a trustless way of doing it, an informed but arbitrary rate is selected and the economic network will adjust to that.
But a low and arbitrary inflation rate is better than an arbitrary cap on the number of units.
In an only deflationary environment we probably wouldn't have much monetary deflation at all
but only because we wouldn't have much economic expansion.
A small amount of monetary inflation is a healthier situation.
essentially I'm suspicious of the idea that a fixed number of units somehow magically sets the hurdle rate at the "best" level.
It doesn't magically do so, the market does so. Arbitrarily adding inflation just changes the hurdle rate by dilluting all participants. When given the choice between the market determining the economic value of money vs the same thing +plus arbitrarily dilluting those participants, I don't see a strong argument for adding dilution to the analysis.
It’s just a different way to pay for proof of work then just paying fees, fees tax the tx, inflation taxes the entire network evenly it’s just a different solution to the problem of how to pay miners.
thats the other network security argument 👍
having subset of users (transactoors) bear the burden of the security budget is also a bad incentive structure.
exactly because it lowers the hurdle rate.
theres no good argument for "we should have the hurdle rate as high as we possibly can"
and the "dilution" isnt really dilution in the context of economic growth. it simply makes it easier to use the money to create economic activity, the overall context is likely still deflationary.
and if growth slows for a while and its .5% inflation, so what?
the hard cap alternative is a situation where the greater the economic growth, the greater the incentive is to simply hodl the money.
which is a really terrible incentive structure.
I think one big difference is the inflation pays miners who do actual proof of work to secure the network very different from the inflation we have in fiat.
Gold has inflation because you can mine it. But nobody knows how much the planet still has left. Apart from that, nobody knows exactly how much humanity has already stored. Jesus, not even Fort Knox has been audited in years. You see my point?
My point is simple, thus leaving “popular misconception”: men made inflation is bad in general, therefore, if we can create something that’s deflationary, why would we need something “a-tiny-bit” inflationary to start with?
This is one of the powers of Bitcoin over… any other currency.
because "inflation is always bad and deflation is always good" is just bad economics.
its pop culture economics espoused by maxis.
deflationary environments are NOT positive and there are good reasons to have known, predictable monetary inflation.
That’s your point of view.
That's not true. The Austrian School has long seen inflation as harmful, well before Bitcoin existed. Mises called it a deliberate policy that distorts prices. Hayek warned it leads to unsustainable booms. Rothbard said it's theft through hidden taxation. These aren't "pop" takes — they're foundational economic critiques that predate any crypto narrative.
constant inflation being harmful,
which everyone including Keynes agreed on
doesn't mean they thought a permanently deflationary conditions was preferable.
alternating between inflationary and deflationary is normal market dynamics
to continue
Mises specifically argued against the sloppy definition of inflation as a simple increase in money supply.
he said if we are to use the term *at all* it should be used as increase in money OVER the demand for money.
in other words, according to Mises, increasing the money supply in line with the demand for money
isn't inflation at all.
The classic definition is better, because it is measurable, objective.
The new definition and all its variants is relative and makes intertemporal comparisons very difficult.
referring to any increase in the money supply as "inflation" is pop economics.
its a convenient shorthand, i do it too
but as Mises points out, its vague and non-technical.
the main issue is: you can't truly know the CURRENT supply of monero because your timechain is not transparent
if there's ever a inflation bug/exploit, and they abusers are smart (by not overselling) no one will ever spot it
supply verifiablity is a separate conversation.
here we're talking about whether inflation is always bad or not.
and you're also wrong
have you verified the supply yourself? or just trusting a random website made by a single guy? do you even understand any of the things mentioned in that website? it's a huge trust me bro, good luck
when was the last time you verified the Bitcoin supply yourself?
or just trusting someone's implementation of gettxsetoutinfo?
we all have to place trust somewhere.
and I understand the basics enough to trust their methodology.
This one I do check, at least once a month.
I understand your POV, but it is easily check able both the easy way (gettxoutsetinfo, getblockchaininfo) or writing a small program to calculate “manually” based on the reward logic.
I agree with you on where we choose to place our trust. But it is a lot better when you can trust and easily verify, right? In Bitcoin you can.
its awesome that you verify it yourself,
seems like you should just be summing the utxoset however...
its more difficult to do the same on monero and therefore generally a higher level of trust is needed
but it's not fundamentally different.
Have you verified the bitcoin supply yourself?
They're both math. One is addition, the other is a little more involved. But if the math is proven correct they're both equally verified.
This one I do check. I understand your POV, but it is easily check able both the easy way (gettxoutsetinfo, getblockchaininfo) or writing a small program to calculate “manually” based on the reward logic
You can do the same thing with Monero, it's just verifying the range proof math and coinbase transactions.
Yeap, we were talking about inflation nostr:npub12rrvutnfeu9677d4yjytypqccjn0njnm6zkx2j6xyn2uqfw02ldsrl8ty9 . It is a healthy one we are having, I believe. I’m loving to read nostr:npub1lxzaxzge0jq9u9cecucctdt5lslwgp7hcxmp2l0wn8r2ecjenwasu6svxa input.