Quote from: sidhujag on January 08, 2017, 11:37:20 PM

Quote from: Lateralus on January 08, 2017, 09:39:37 PM

I find it funny the people who think FRB is a scam also think inflation shouldn't exist.

Money is nothing other than the lifeblood of society, and just as a human body grows in size and requires a larger volume of blood, the economy requires an increase in money supply in order to operate effeciently (hence the term "liquidity").

100% reserve banking is socialism because it leaves no legitimate way to expand the money supply, and a fixed money supply rewards people who sit on their ass, it treats money like it was a corporate share in the economy that should increase in value as time goes on. This is also why cryptocurrencies which are modeled on fixed money supplies are doomed to fail over the long term (or at least fail in the sense that they will always be relegated to niche uses, rather than becoming primary or world-leading currencies)

Roach you're just another luddite running your mouth about a world you haven't even begun to understand.

Right and the increase in supply needs to be publically auditable and linked to a public metric which demands more or less supply. That would be ideal. Frb today causes rates to drop indefinetily and ultimately fail as it enslaves debt holders.
In my design coins are inflated based on demand and deflated if velocity falls under some threshold. You can read my mechanism design about it here:

Syscoin.org/whitepaper.pdf

I'll be honest I really only come to this site because it's the only english forum that I know of where people discuss Armstrong's work. So my understanding of cryptocurrency is extremely limited, it's just one of those things that I have on my "to study" list.

In my mind in a theoretical free banking market of competing currencies, I'm wondering if it's possible there would be no need of "mining" in the first place.

If we set cryptocurrency aside for a second, and look at what a free banking market of competing paper currencies would look like, I imagine it is actually fractional reserve banking itself that automatically regulates the supply of money and interest rates. As the demand for money grows (due to increased economic confidence & desire from entrepreneurs and established businesses to take on risk), banks would then also be more willing to take on risk because those businesses would be more willing to pay higher interest rates. But the banks can't simply create as much money as they want (as the gold bug types would suggest), because they must manage the amount of leverage they are using with depositors funds (the fractional reserve rate). Too much leverage (too low reserves), would mean too much risk, and of course there would naturally develop an industry for third party auditing which tracks the reserve rates of each currency in the various banks. We could see high risk (relatively speaking) currencies, and low risk currencies develop. Maybe even currencies for use specific industries, as well as separate consumer level currencies. Who knows really.

So looking at cryptocurrency, I'm wondering if this whole concept of digital "mining" is nothing but an unnecessary roadblock to establishing a truly successful cryptocurrency. I'm wondering if Satoshi was one of these "gold bug" types who mistook the flaws of government monopolization of currency creation (and thus the banking industry itself) as a flaw of paper currencies themselves. Like Armstrong I don't see gold as "sound money", but merely a commodity which people have used to hedge against the inevitable failures of government. On the contrary I see paper currency as this miraculous thing that never had a chance to truly thrive in a free banking market, as no free banking market has ever been allowed to exist for long enough to stabilize. Cryptocurrency is obviously likely to be even more miraculous, and thus maybe we're just in the process of skipping past ever seeing an era of such free market paper currencies as I described. Still, I feel that thinking about how such free market paper currencies might work is an invaluable thought experiment.

Again maybe I am completely misunderstanding the purpose of mining in cryptocurrencies, but it seems to be nothing other than a product of this fallacious belief in fixed money supplies and unfounded fears of hyperinflation. Hyperinflation is really a product of governments trying to preserve their power by ordering banks to continue to operate on the state currency despite the irresponsible amount of state debt which is denominated in the currency. Hyperinflation is merely what happens when corrupt societies attempt to rapidly liquidate their holdings of state debt in a panic, as they subconsciously or consciously realize they've bet their life savings on something which is essentially a giant cult ponzi scheme.

That is what modern countries are to me, giant cult ponzi schemes. Or in the words of Bastiat "Government is the great fiction, through which everybody endeavors to live at the expense of everybody else."