In the year 2025 Maidsafe will have an estimate of 1.7 billion users, business customers/end users etc.
The max Safecoin on the market will be 4.3 billion.
This will cause a massive deflation and high value for Safecoin.
Humans like to save money/Safecoin so the price of 1 Safecoin will rise to 1850 USD due to lack of Safecoin. Early investors will become millionaires. maidsafe company will be valued over 100 billion USD.
Many Safecoins/vaults will be lost forever when people forget their secret codes and passwords, or if a user passes away or gets Alzheimer illness etc.
As long as there is no division in Safecoin the price will rise and rise every year with a massive deflation as result.
What to do and how to cope with this issue ?
Divisibility will be introduced before the price gets too high, or quickly after, I’m sure. The subject has been discussed quite a bit here on the forum. Search function will reveal some interesting discussions.
I am working on a pre-rfc discussions topic now for my idea of doing this. Expect that to occur in November. The devs are way too busy to even read it now, so not much use doing it this month. I need some input from them.
Even though it will be divisible by then … even it it weren’t, this isn’t really a problem. There are already other currencies out there that are quite divisible that one would be able to trade for Safecoin. So, that said, why is the deflation of Safecoin a problem? Specifically can you give an example?
So, that said, why is the deflation of Safecoin a problem? Specifically can you give an example?
I think that the focus on deflation may be being overdone - partly because there will be divisibility as mentioned, and while there will be deflationary pressures due to limited supply:
storage/farming/recycling are likely to be a dominant economic activity, growing faster than (or roughly as fast as) services which create deflationary pressures
The problem will be: if you want to pay for a service which costs a few penny, how you are going to do that with Safecoin if the value is too high ? You could do that by selling your Safecoin to other blackchain coin and pay the service but it is not practical and it will cost exchange fees etc. Divisibility is the best option.
The other problem will be, as happybeing mentiond shortage of supply. If 100 million users save only 43 safecoin each in their vaults, Than 4.3 billion Safecoins are out of market and recycling will stop. And Of-course many people save more than 43 Safecoin. Some App owners get rich and hold millions of Safecoins. The Safecoin will be rare like a diamond !
Divisibility would be one of the first things I’d introduce. It’s already too expensive, and it’s only gonna get worse. I don’t understand the (technical) reasons for making it the way it is now, but I hope they’re not severe.
Another, also discussed earlier, is to purchase a quantity of something with one Safecoin (creating credit balance in that “something”), but use up that quantity in smaller amounts.
This won’t be ideal in all situations but will suffice for many use cases in the short-medium term, and is how purchasing storage will work for starters.
I tend to agree with your conclusion (divisibility is quite important), but there’s something else to look at here:
Blockchain coins should not be needed. Altcoins on the SAFE Network will enable the equivalent of side-chains pretty much from day one. So safecoin will be the currency of the network functions, but committing a quantity of safecoin to be tied up in a SAFE Network structured data coin, given value only by sequestered safecoin would handle the divisibility handsomely without having to go off network to bitcoin or some other solution.
See SAFE Crossroads episode #30 for a discussion on some of the possibilities along this line. Divisibility need not necessarily be a core safecoin functionality, perhaps, in order to achieve full functionality.
Not nessesarily. If Safecoin is Gold you could create another altcoin using structured data equivilant to silver, copper and milrays or however small a division of currency you want to get. That is each new altcoin could represent a smaller denomination of value just like we have different types of physical currencies that are minted: (to use a Canadian example) Twonies $2, Loonies $1, Quarters $0.25, Dimes $0.1, Nickels $0.05 and the now retired as of 2012 Penny $0.01. In fact there’s even talk of creating a $5 coin, a Fivesie or something. My point is that different altcoins could be minted the same way to represent different values of money. What we really deal with in currencies are in fact different currencies all working along side one another representing different values of money. But we’re so used to thinking of the different demoninations as the same currency we don’t think about what we’re looking at. What do you do when you have a ton of coins? You go and trade them for bills of course! You “buy” a different form of currency. So what would you do when you hat too many or not enough of a particular denomination of a particular altcoin? You’d buy a different one! If safecoin value shot through the roof and divisibility didn’t get introduced we’d just introduce new altcoins to represent smaller denominations just like we would with regular physical money. It’s a no brainer.
What does it mean to devide a Safecoin? Because a Safecoin is not like a bitcoin. A bitcoin is a number on a ledger and a Safecoin is a digital file on the Safenetwork.
Thats why it has not been “done” yet. No RFCs yet.
There are basically two ways to have a network owned “divisibility” and that is
to introduce something like “SAFEcents” which are SDs themselves but worth for example 1/100th of a SAFEcoin and the network operates them like SAFEcoin. The APPs/wallets work with them.
to introduce a form of ledger that the network operates with
The problems with SAFEcents is you potentially multiply the network work load of any transaction by upto 100 times. If a user has 1000 SAFEcents only and sends 10 SAFEcoin the network would send the 1000 “SAFEcents” which is 100 times the transaction workload as if 10 coins were sent.
The problem with ledger is how.
I estimate we have at least 4 months to introduce a divisibility RFC and see it in the beta with test SAFEcoin, and then only if the dev team deem divisibility a necessity. Really divisibility is only required towards the end of beta testing and only if the price keeps rising.
