Possible outcomes from altering the ether supply growth rate

[ldct]

increased issuance to validators in PoS makes it more attractive to become a validator, thereby increasing the amount of eth staked, thereby making “economic finality” be stronger in that a larger amount of eth will get slashed in a history with a reversion of a finalized block.

[Danny]

I think this is an important distinction when people get nervous about supply increases leading to direct negative impact on value a la Venezuelan inflation style.

You mentioned the inflation tax(seigniorage) and the infinite quantitative easing like Venezuela or Turkey.

I think this problem is a really important factor in monetary ecosystem, including the token ecosystem, but the price volatility of the crypto-currency is so much that there has been no mass adoption Also, majority of tokens have no function of medium-of-exchange. So maybe many people couldn’t notice their inflation Tax.

In my opinion, whatever the economic world(real world or crypto world), the fiat and crypto are in same state in terms of the commodity. So, I think the finite supply or infinite supply is not the essential. The critical thing in a monetary policy and crypto-issuance is “how we make the demand and supply of money(token) in same level”. It’s the most critical factor of price-stability.

So, anyway, @vbuterin is there any decision on issuance model?

[DB]

Another concern is that if we promote a hard norm about a supply cap (supply will never go up above 121 million! If it does then by definition it’s not even ethereum!!!1!1!!), then we lose the ability to later increase issuance, either because we later decide that that is the best way to get security, or because we want to use issuance for other reasons (eg. an on-chain-governed decentralized bounty fund, or an airdrop of N coins per person to as many people as possible).

How about a hard cap on supply, that will not be reached under the current plan, as a compromise? For example, announcing that 200M is the hard limit never to be crossed (!!11!), but making sure Shasper with 0 issuance will arrive well ahead of reaching 150M. This way there is room for additional needs, with the guarantee to the users that “monetary policy” is not the future of Ethereum.

[toms119]

As an aside, in a PoS world a large % of ETH will be locked up which is an artificial cap per say.

If 50% of stake is locked up, that means there is much less 1) liquidity and 2) a lower free float which would make it much harder to purchase a control % of the ETH supply

I.e. the slippage of buying more and more ETH pushes up the price (impossible to know the rate) but whatever this rate is, it is 2x as high if 50% of the supply is locked up by stakers.

Just an idea that it would be harder to “purchase” a controlling level in a PoS world, in my humble and new opinion