Quote from: Rygon on July 17, 2014, 03:24:23 PM

I don't think everyone understands that this guy is talking about an algorithm (something that would be a part of the code) and not an actual central bank. I think it would be great to have an algorithm that could dynamically adjust coin generation based on the global supply and demand of the coin, which would damper price flucuations. But the issue to do it in a way that was clear and transparant, and couldn't be manipulated by miners, whales, exchanges, etc. It might not be possible because there's no obvious way to sample the supply and demand of bitcoin since that happens outside of the code, in exchanges or private transactions.

On that same note, bitcoin would be just as useful even if it didn't have a 21M cap or halving every 4 years. The key isn't the total fixed supply, it's the predictability of the generation. It's factored into the determination of price, which is why the first bitcoin halving didn't have a significant effect on the price (Other than assuring the market that the network wouldn't break, lol). Bitcoin could have kept generating 50 coins/10 minutes forever, and bitcoin wouldn't lose any real capability. And prices would have still risen because the demand has far outpaced coin generation.

... all these models suffer from a disconnect with reality. How do you measure and monitor the economy sufficiently accurately enough in a manner that is not prone to centralised failures?

You cannot feed inputs into a system that bases its utility on a distributed network, via a centralised measuring/monitoring signal and expect it to retain the robustness that makes it superior.