This one is very common from the Bitcoin cult, and is techically true.
However, there is a lot of thought and intentional design that has gone into the supply dynamics of Monero. Monero implements a “defined supply” of 18.4m coins, and has a tail emission of 0.6XMR per block after the defined supply has been mined. That tail emission starts ~May, 2022.
This means that Monero has extremely low inflation that approaches 0% forever, and is technically “disinflationary” or “asymptotatically approaching 0% inflation”. The inflation rate is currently lower than Bitcoin and gold, and will continue to decrease. It’s also important to realize that a low inflation rate like that of Monero is a way to replace lost coins over time in circulation, but is likely even too little inflation to account for lost coins (rough estimates are ~1.5% of coins lost in circulation each year, compared to Monero’s current inflation rate of 1.12% as of writing). This would mean that Monero is in fact deflationary, even with the low perpetual issuance.
It’s also extremely important to make it clear that Monero’s supply is pre-defined, verified and enforced via consensus, and entirely predictable, just like Bitcoin’s – you can know the inflation rate and totaly supply at any point in the future without doubts.
This tail emission enables two key features in Monero
A lower bound of network security forever (miners will always be able to rely on 0.6XMR per block, no matter the fee market)
A dynamic block size (Monero’s blocks can grow/shrink to adapt to short-term increases in usage, with a penalty to mining rewards during these times).
For more on both of these, see the resources below.
Resources
Descriptive website with graphs showing the supply dynamics of Monero: https://monero.supply
“Why Monero has a tail emission”: https://localmonero.co/knowledge/monero-tail-emission
“How Monero Solved the Block Size Problem That Plagues Bitcoin”: https://localmonero.co/knowledge/dynamic-block-size
Inherent risks in not having a defined block reward in perpetuity: https://www.cs.princeton.edu/~arvindn/publications/mining_CCS.pdf
dr.fred /
npub1he…ymce6
2024-09-04 00:06:52
in reply to nevent1q…exl4
Author Public Key
npub1heysg4r5mq354k7n3hlk0wae4c4x6p5kh7qfu38fe5f24s82vvvqxymce6Seen on
wss://relay.damus.ioPublished at
2024-09-04 00:06:52Event JSON
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"content": "This one is very common from the Bitcoin cult, and is techically true.\n\nHowever, there is a lot of thought and intentional design that has gone into the supply dynamics of Monero. Monero implements a “defined supply” of 18.4m coins, and has a tail emission of 0.6XMR per block after the defined supply has been mined. That tail emission starts ~May, 2022.\n\nThis means that Monero has extremely low inflation that approaches 0% forever, and is technically “disinflationary” or “asymptotatically approaching 0% inflation”. The inflation rate is currently lower than Bitcoin and gold, and will continue to decrease. It’s also important to realize that a low inflation rate like that of Monero is a way to replace lost coins over time in circulation, but is likely even too little inflation to account for lost coins (rough estimates are ~1.5% of coins lost in circulation each year, compared to Monero’s current inflation rate of 1.12% as of writing). This would mean that Monero is in fact deflationary, even with the low perpetual issuance.\n\nIt’s also extremely important to make it clear that Monero’s supply is pre-defined, verified and enforced via consensus, and entirely predictable, just like Bitcoin’s – you can know the inflation rate and totaly supply at any point in the future without doubts.\n\nThis tail emission enables two key features in Monero\n\nA lower bound of network security forever (miners will always be able to rely on 0.6XMR per block, no matter the fee market)\nA dynamic block size (Monero’s blocks can grow/shrink to adapt to short-term increases in usage, with a penalty to mining rewards during these times).\nFor more on both of these, see the resources below.\n\nResources\nDescriptive website with graphs showing the supply dynamics of Monero: https://monero.supply\n“Why Monero has a tail emission”: https://localmonero.co/knowledge/monero-tail-emission\n“How Monero Solved the Block Size Problem That Plagues Bitcoin”: https://localmonero.co/knowledge/dynamic-block-size\nInherent risks in not having a defined block reward in perpetuity: https://www.cs.princeton.edu/~arvindn/publications/mining_CCS.pdf",
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