Author: Anthony Towns 2022-07-11 02:32:47
Published on: 2022-07-11T02:32:47+00:00
In a recent post on bitcoin-dev, Peter Todd argued that tail emission is not inflationary. However, the assumption that coin losses are independent and the rate of loss is proportional to the total supply at that moment in time is not necessarily true. Coin losses could be due to a common cause, such as a bug in a popular wallet or exchange software, or a natural disaster that damages key storage hardware. Losses could also occur at a predictable rate that is entirely different from the one assumed by Peter Todd.One plausible alternative predictable rate of loss is due to people being less careful about losing small amounts of Bitcoin. Mathematically, this scenario requires a non-inflationary currency with constant adoption and a constant price in real terms even if the economy is expanding or contracting. Additionally, it is important to find ways to minimize the rate of coin loss over time rather than leaving it constant. In fact, an even stronger goal would be to decrease the real value held in BTC lost each year.
Updated on: 2023-05-22T20:38:48.666430+00:00