The Metaverse

[Clinamenic]

it doesn really matter, neither the blockchain nor bitcoin can prevent expansion of liquidity on demand, and in fact must provide it in order to support functional markets

What about simply issuing new supplies of tokens that are already liquid?

Also I don't think I'd disagree with this. Expansion of liquidity seems like a requisite for economic growth, no?

 

[vimothy]

sure, but: where does this liquidity come from, and, isn't this precisely what crypto exists to prevent?

 

[Clinamenic]

sure, but: where does this liquidity come from, and, isn't this precisely what crypto exists to prevent?

You mean, isn't crypto designed to prevent private parties from adding liquidity to the system at their whim? I don't think so, I think blockchain is pretty conducive to that, if I understand what you mean.

 

[vimothy]

its certainly conducive to it in practice, but it's not supposed to be.

 

[Clinamenic]

In fact I think there could be major problems with how Tether, the largest stablecoin, goes about its issuance. There are doubts about whether or not it is fully backed by dollars or dollar equivalents. I'm not sure if such backing is really necessary, but then again if it isn;t necessary, whats to stop them from just issuing as much as they want, and pocketing it?

 

[vimothy]

a good question

 

[vimothy]

what is the point of crypto, in your view? why does it exist?

 

[Clinamenic]

what is the point of crypto, in your view? why does it exist?

I think its a way of digitally facilitating value, like how we already do with digital dollars and the existing financial system, only much more programmable. And I think the public aspects of blockchain introduce the notion of public goods to the internet, in ways that don't really seem feasible with the existing internet stack.

 

[Clinamenic]

I mean is there any real precedent, in terms of significant portions of the internet running on distributed networks? Yet alone global financial systems? As opposed to privately owned networks of computers.

 

[vimothy]

this is not the original motivation for bitcoin / crypto, which is to establish a "digital gold" whose supply cannot be manipulated for political purposes

I think its a way of digitally facilitating value, like how we already do with digital dollars and the existing financial system, only much more programmable. And I think the public aspects of blockchain introduce the notion of public goods to the internet, in ways that don't really seem feasible with the existing internet stack.

 

[Clinamenic]

I think that is what I mean by public, that the network itself underpinning the protocols is owned collectiovely and in a permissionless fashion.

 

[vimothy]

I mean is there any real precedent, in terms of significant portions of the internet running on distributed networks? Yet alone global financial systems? As opposed to privately owned networks of computers.

the whole internet is distributed

 

[Clinamenic]

this is not the original motivation for bitcoin / crypto, which is to establish a "digital gold" whose supply cannot be manipulated for political purposes

Yeah my view doesn't align with what I understand Nakamoto's view to be. I suspect the original Bitcoin vision is off the mark, but I haven;t read the whitepaper.

Like I don;t think BTC will really challenge the dollar, but I do think BTC could form a solid, inflation-resistant bedrock for a global digital financial system, not unlike gold.

 

[Clinamenic]

I suspect there are distinctions to be made between the original vision of Bitcoin, and how the collective vision for web3 has evolved since then. I don't know if Nakamoto foresaw smart contracts, for example.

 

[Clinamenic]

the whole internet is distributed

Yeah a poorly conceived question, on my part.

 

[vimothy]

how will it be inflation resistant? the idea is that you cannot simply create new liquidity whenever you need it

 

[vimothy]

so called stablecoins like tether simply provide this missing piece of the puzzle which facilitate a crypto ecosystem

 

[Clinamenic]

how will it be inflation resistant? the idea is that you cannot simply create new liquidity whenever you need it

Well BTC here is different, in that the issuance decelerates to an asymptote around 21,000,000 BTC, after which point mining rewards are pulled from the pool of transaction fees, rather than minted into existence.

There are a bunch of different components in web3 that have different visions and purposes. So with something like Tether, the issuance may be at the discretion of BitFinex (or whatever Bit____ issues it), but I;m less familiar with that.

 

[Clinamenic]

But yeah beyond non-inflationary assets like BTC, depending on the code of the asset, it can be possible to simply mint new token supply into existence.

 

[Clinamenic]

And in order for Bitcoin's issuance protocol to change, the majority of computers comprising Bitcoin's network need to agree to shift to a new version of the code.

This is rare, but possible. Hence my previous disclaimers of almost immutable databases.