Is the Safecoin Economy Deflationary and would it be better with Inflation built in?

[Anders]

@betterthantrav

This goes back to basic economics. The SAFE Network accounts for supply and demand and rewards farmers accordingly. Unlike bitcoin witch rewards miners at a fixed rate.

Edit: So, is different than Bitcoin mining.

Now you have flip-flopped. You wrote earlier that the value of safecoin is determined by the use of the SAFE network. I totally agree with that. And the demand for using the network increases enormously with free data storage. With a cost for storing data you can have tons of farming resources that hardly anybody would use. Very much resources and very little demand. (I’m exaggerating a bit just to illustrate the point.)

[riddim]

@Anders

And the demand for using the network increases enormously with free data storage.

until it breaks … and if it breaks only once the trust is gone …

…and in your system with more and more usage + more and more storage demand → more and more inflation → ?

[betterthantrav]

@Anders

Now you have flip-flopped. You wrote earlier that the value of safecoin is determined by the use of the SAFE network. I totally agree with that. And the demand for using the network increases enormously with free data storage. With a cost for storing data you can have tons of farming resources that hardly anybody would use. Very much resources and very little demand. (I’m exaggerating a bit just to illustrate the point.)

That is not what I wrote. I said the value of Safecoin is based on its ability to buy, sell, and trade goods and services from the network. Not use resources for free.

[betterthantrav]

I’m sorry this was meant for @anders

[Anders]

@betterthantrav

That is not what I wrote. I said the value of Safecoin is based on its ability to buy, sell, and trade goods and services from the network. Not use resources for free.

They go together. You need free data storage in order to build up enough network effect so that the SAFE network becomes YUGE. Only then will safecoin be used a lot.

[riddim]

oooookay - i never liked snakes anyway Oo

ps: ok - i hoped so cause i was pretty confused xD

[riddim]

@Anders

You need free data storage in order to build up enough network effect so that the SAFE network becomes YUGE. Only then will safecoin be used a lot.

that is your opinion and not a fact … servers aren’t for free and they get used pretty often today … phones aren’t free and they are used … and though apple devices aren’t the cheapest they are widely used all over the world … things don’t need to be for free to get used … even whatsapp costs …

[betterthantrav]

@riddim

things don’t need to be for free to get used … even whatsapp costs …

If it’s free you are not the customer, you are the product.

[betterthantrav]

@Anders

Now you have flip-flopped.

I quit you are worse than Warren. Im done this will be the last response you will get from me.

[Anders]

@riddim

until it breaks … and if it breaks only once the trust is gone …

…and in your system with more and more usage + more and more storage demand -> more and more inflation -> ?

People with botnets will be uninterested in spamming the network since there is no profit in it for them. And for individuals it takes 24 hours to upload a single 1 TB file with an upload speed of 100 Mbit/s.

A flat inflation of 1 billion safecoins per year will be moderate enough while the network grows exponentially. And then later when the growth of the network slows down after say a decade, then the inflation rate percentage-wise is smaller than in the beginning. There is 100% inflation between year 1 and 2 and only 10% inflation between year 10 and 11.

That’s inflation in terms of total supply of safecoins. The monetary inflation will be much less or even a deflation, since the value of the SAFE network grows exponentially during the first years when the safecoin supply increases a lot in percent. Exponential growth and linear increase of the safecoin supply.

[jreighley]

This whole thread is already irrelevant.

MaidSAFE coin was sold under certain terms. Namely that there would be X number of SAFEcoin issued and 10 percent would be sold in the pre-sale.

Any changes at this point would make that sale fraudulent. It isn’t going to happen…

[Anders]

@riddim

servers aren’t for free and they get used pretty often today

Facebook is free! Google Drive is free for most people (free quota). Sure, they own our data and spam us with ads, but hey people accept that. In order to make people switch to something that will cost them money requires a lot. Much better isn’t enough. It needs to be much, much better. And free. Or else people will not bother changing their behavior.

[Anders]

@jreighley

MaidSAFE coin was sold under certain terms.

I found this:

“It is proposed that safecoin will have a predictable cap (2³²) with a value that is determined solely by the market.” – https://github.com/maidsafe/Whitepapers/blob/master/Project-Safe.md

So the cap isn’t definite. Or were the terms written in another way?

[riddim]

facebook is already dying and people will have to learn that nothing is for free in our world …

…sorry but i just disagree with your opinion

@Anders

People with botnets will be uninterested in spamming the network since there is no profit in it for them.[…] There is 100% inflation between year 1 and 2 and only 10% inflation between year 10 and 11.

again just an opinion with the botnets i’d say … and those aren’t the only danger out there …

and no matter how you design the inflation … without paying anything for storage (even without anybody abusing the service) you’d be over- or under-paying farmers … i don’t see how you could solve this problem of not having a feedback-loop maintaining the “right amount of storage” (ignoring the fact that i’m against free storage …)

edit: ps: ok when storage capacity is low you could increase farming reward → when it is too high you could reduce it … just like it is done now …

[Melvin]

cap is definite, that has been made clear a few times.

[jreighley]

@Anders

So the cap isn’t definite. Or were the terms written in another way?

Safecoin, why it’s safe and what it means for us all

See the heading safecoin launch fundamentals

[Anders]

@riddim

you’d be over- or under-paying farmers

My idea is that there will be over-paying to the farmers all the time. The farmers are the engine of the network. And the safecoin value will increase so much that it’s possible to over-pay the farmers. And doing so ensures that the network keeps having enough (and growing) farming resources.

Remember, the actual value of safecoin will be what the SAFE network provides as a service for all kinds of things. When the safecoin market cap has grown really big (to the moon), then the value of the physical data storage will only be a fraction of the total safecoin market cap.

[riddim]

ok i see your point and i agree that you can argue this way …

…i still think there is a problem with the long-term-stability … I like the idea of free storage - i really like free storage solutions … but I don’t trust free solutions because always someone has to pay for it … and in your system it is like a tax … everybody pays for the few people using massive amounts of storage … yes it might help mass adoption because people are stupid and don’t realize they pay … but it is not fair, an invite for abusing it and no debatable point

[Anders]

It says finite amount 4.3 billion. But David Irvine wrote in a comment further down:

“We discussed these issues for a long time on the dev list. safecoins will always be farmed. Initially the cap is 4.3Billion, it is not likely to increase, but that is not impossible in ten years or so.”

Hmm… How about 4.3 billion flat rate over ten years? That’s 430 million per year increase of the safecoin supply. The IPO participants have 430 million safecoins. After ten years the flat rate of 430 million per year can continue. That would be consistent with what David wrote, and the IPO participants will be able to receive more return on their investment than when using some Bitcoin-like model for the increase of the safecoin supply.

[betterthantrav]

@happybeing

The plan is not to support division unless necessary, and that will at least to an extent depend on how the network develops and what people want to use Safecoin for.

At some point the network will grow to x amount of users and Safecoin will have to either dived or inflate in order to remain usable. I vote for the one that does not steal value.