Quote from: rpietila on November 22, 2013, 08:11:10 AM

Quote from: Zangelbert Bingledack on November 21, 2013, 05:38:30 PM

Quote from: hamiltino on November 21, 2013, 07:22:01 AM

Watch out for emunie, it may just take the crypto crown.

Any cryptocurrency aiming to have low volatility will have low adoption. It seems the creator doesn't understand economics.

I have also devoted some thinking to the matter. Bitcoin's parameters are the most optimal that I have seen, if the objective is to get the currency off the ground and achieve the highest 'market cap' valuation:

- Initial creation is rather centralized, in opposed to distributed. (Nearly) Same amount of old world resources must be burned to create new currency.
- Most holders by number need to acquire their bitcoins from an exchange, giving them a fiat price.

If the value is measured in fiat price vs in # of transactions.

Short-term vs long-term valuation respectively.

Quote from: rpietila on November 22, 2013, 08:11:10 AM

- This leads to a power-law distribution in bitcoin balances from the beginning. This is the most natural distribution and minimum amount of trades need to be made in the aftermarket to achieve it.

Apparently most natural for an ponzi-bubble investor coin, not for a transaction coin.

Quote from: rpietila on November 22, 2013, 08:11:10 AM

- This leads to stiff but predictable supply inelasticity, which leads to high volatility mainly to the upside.

Agreed.

Quote from: rpietila on November 22, 2013, 08:11:10 AM

Compare this to the XRP distribution, which completely disregards all economic principles and thus was an utter failure, forever destining XRP to be a trading card game, and discrediting the (otherwise promising) Ripple network in the process.

Is it a strawman to state that the failure of a fractional reserve system predicts the failure of any system of gas diffusion distribution which is capitalistic-- the work done to attain the coin should roughly equal the value of the coin?

I think the answer is no.

It seems to me that the key distinction is that to distribute a coin widely and capitalistically, the economy-of-scale of aggregating a plurality of worker units must be very low.

In other words, the fungibility and divisibility of tasks should be very low and high respectively.

The reason money exists is because it increases the maximum divisibility of labor, because money is fungible but knowledge is not. Otherwise we would barter directly in knowledge.

Large capital can't buy diverse knowledge, the economy-of-scale is low because the divisibility and specialization is high.

This is my fundamental insight.

http://www.coolpage.com/commentary/economic/shelby/Demise%20of%20Finance,%20Rise%20of%20Knowledge.html

http://www.coolpage.com/commentary/economic/shelby/Understand%20Everything%20Fundamentally.html

http://unheresy.com/Information%20Is%20Alive.html