Gnosis Founder’s Remark on Bitcoin Inflation and Ethereum’s Monetary Policy

• Bitcoin investors and Ethereum investors have been against each other for quite a long time, but now it is time to have a fact check.
• Ethereum lovers say that let’s have a simple network rule that as little as possible amount of coins will be released and that will help secure the network.

Bitcoin investors and Ethereum investors have been against each other for quite a long time, but now it is time to have a fact check. Bitcoiners say that they need to tell everyone that there is a hard cap.

For years Bitcoiners have criticised Ethereum for its unclear monetary policy. Reality check:
Bitcoin: Let's tell the users there is a hard cap. Insiders know however it might be removed.
Ethereum: Let's have the simple rule: as little issuance as possible to secure the network. https://t.co/T3Di4y1bpk

— Martin Köppelmann 🦉💳 (@koeppelmann) February 24, 2020

However, all the people on the inside know that might be removed. Whereas the Ethereum lovers say that let’s have a simple network rule that as little as possible amount of coins will be released and that will help secure the network.

We should not underestimate the ability of mainstream anything to engage in motivated reasoning. The very obvious motivation of the people is that they want hard money, and many economists wish that they did not.

Hence, they plainly deny the very obvious, inflation is a punitive tax on everyone’s savings, and then they make up some psych nonsense to cover it up. But at the same time, they can also recognize a very valid reason for inflation that is to pay for security.

That reason does not need for more than a token amount of inflation, and about 0.5 percent would be just fine. Even though they are indeed brilliant people, they are unethical, too, as they do not tell the truth.

As it turns out, the Bitcoiners are equally guilty, because 21 million BTC is practically almost a religion, and anyone with any economic sense can know that we do have a high inflation rate and even then do just fine. The difference between 0% and 0.5% is as insignificant as it sounds.

But motivated reasoning covers it all.

Steve Anderrson

Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.