Money is a messaging system... Metcalfe Law describes the number of unique possible connections in a messaging system is the square of the messaging participants. Communicating value is the point of money (that's its value proposition), so the value is proportional to the number of participants that can communicate with each other. That is the square of the participants... exponential

Reply to this note

Please Login to reply.

Discussion

So I can't exchange one money for another?

?

Lol. I'm not sure if we're specifically referring to monetary systems or networks anymore, but this applies to both: a network of any kind that has wide reach gains usability and influence but not necessarily value.

The wide usability is the value... if that value becomes monetary is based on it's scarcity. English has tremendous value due to it's network effects, but zero monetary value because it lacks scarcity

What happens to the value if the usability were to be cut in half?

Here is a handy graph

In terms of monetary value, the asset would begin to lose value more quickly than usual. In terms of usability, less would be utilizing it.

Exponentially