Topic: Altcoin that doesn't lose value (Read 2980 times)

Then you're holding on to Federal Reserve Notes, which lose value over time at unpredictable rates.

There's a market there for a less volatile altcoin.  The folks who are still here have just gotten accustomed to fluctuating prices.  There are investors who play the stock market, and then there are those who focus on other areas in the private sector.  At some point, there's a need for fixed storer of value that is, if anything, slightly deflationary.

Don't invest it in anything. No chance of loss.

Well, 65%, so far, have at least viewed a stable value coin as desirable, if it were possible.

How to implement it?  Target adopters who are the most risk-averse.  Miners and users can download different inflation profiles to their wallets.  Each profile may read different market indicators from across the Net, each with its own methodology.  Block rewards for proof-of-stake mining would remain at the minimal one coin per block, with a med-high difficulty that increases slowly. 

At some point, different clients begin to notice that the FIXEDtoken's purchasing power (compared to precious metals, CPI, various international currencies, other altcoins, land, etc) is beginning to increase by varying amounts.  Each client then transmits a double precision value to the rest of the network as a vote, of sorts.  When the majority of votes are for producing more tokens, reward coins are sent out to miners and wallet holders as a fraction of the number of tokens that they are holding or have mined.  Instead of producing the same number with each block found, the reward is the median of all of the votes cast.

In order to keep each token's value constant over time, these rewards are not generated unless the majority of clients and miners believe that it's value is increasing in real terms at the moment, and only as many reward coins sent out as there is demand at that time.  When the perceived value is going down, the "printing presses" stop, and the reward is reduced back down to the minimum on one token for proof-of-stake work.

So let me ask the question this way:

Dude. If you are looking for "security" in cryptocoins, particularly altcoins, someone has  seriously misled you. Any of them could be at zero tomorrow. They *are* all speculative, even including bitcoin. If you can't afford to lose money, why on earth are you talking about altcoins and how to assure they don't lose value. Completely bizarre ....

I looked over InfiniteCoin's price volatility, and it actually seems worse, to me, than either Bitcoin or Litecoin.  If there is no mechanism in place to retire (or prevent production of) supply when demand is going down, then the holders of the coin are forced to take the loss.  If there is no mechanism in place to discourage currency speculation, then most of the price of a crypto-currency becomes speculative, rather than actual.

I still don't have an answer to the question I posed months ago:

You know, no one has a greater interest in having an altcoin preserve its value than its own adopters.  The problem is that each one have objective and subjective criteria for measuring inflation.  Using a peer-to-peer system, each holder of these coins could run their own monitoring protocol in their wallet program (taking in input from precious metals prices, CPI, PPI, exchange rates, etc), then simply produce a real number: whether or not to pay out interest from the BlockChain and how much.

As time goes on, adopters have an incentive to download more reliable measures of actual inflation.  When a majority of clients (wallets) agree that prices are dropping relative to FIXEDtoken's, they send a number up through the network that relates to the interest to be paid out to everyone holding coins in a savings state (Time Deposit, Vault, Wallet, etc) in order to keep the value of each token fixed over time.

When a simple majority of adopters believe that the FIXEDtoken is beginning to lose value, the "printing presses" stop until demand catches up.

INFINITECOIN actually has a hard cap of 90.6 billion coins. Also if you are looking for stability IFC has it. Just look at its performance during the last few market slumps.

One of the biggest tasks for monetarists (those who believe that any fiat currency should keep a fixed value) is figuring out what the current inflation rate actually is.  In the United States, it is generally understood that the Consumer Price Index is an understated measure of inflation.  Many professional economists believe that it's understated by 1.0-2.0%, but many consumers and even some economists view inflation at about twice that predicted by CPI.

For an internationally used currency, governments should be attempting to keep inflation below 2.0%, but price changes vary widely.  The same volatility exists in the precious metals market, which gold, silver, platinum, and other currencies fluctuating by a factor of two or more in one year.

To more accurately fix the price of an altcoin, one might simply average the price indexes of several major world economies, then simply add 1.0% to get a conservative view of inflation, but this would put the altcoin at the mercy of the international financiers again, since they can always make slight adjustments to those market indexes.

Another technique is to use a basket of currencies, metals, bitcoins, etc.  One could even use the lowest/median/highest price of metals over the past year to minimize volatility.

Turning off the printing presses is easy.  Knowing when--and for how long--is another matter.

Does it have a mechanism to stabilize its value based on the current market price?

WDC is a great choice today.
It is developing fast track and it will go up.
It is backed by a stable foundation.
It has limitations in coins minted (which I love in this coin the most).
The security issues are being handled, this has the best potential to be the next Litecoin - if not more. Based on the limitations of issued WDCs, the expected rate is 0,1 BTC so why not to crab a few thousands today at these prices?

I'll never get any altcoin up to the billions in market cap and hundreds of thousands of users needed to get even the relative stability of Bitcoin.  Of course, few people are willing to accept the volatility of this comparatively small market overloaded with short term speculators who create price spikes which make it difficult to buy in (and scary to own).

Using two different short-term mechanisms together with one or two long term mechanisms helps transform price spikes into reserves, which can then be used to support the altcoin itself.  This isn't rocket science.  This just requires that we use our heads and give the altcoin open source peer-to-peer mining/wallet client enough intelligence to know that it should never approve a big coin reward to the mining pools unless the demand for FIXEDtoken's is on the rise, among other mechanisms.

The simplest way to break the cycle of volatility is to grow the market. The process we are going through at the moment is very dramatic due to almost each sale having a visible effect on the price - that doesn't happen with fiat because the market is massive.  You would need to sell a few billion units to move the exchange rate by a decimal. In altcoin world, the pump and dump process can be financed with only 10 to 15 bitcoins

There is no need to spend effort on yet another super coin, just spend your time developing ways to spend the altcoins, and get regular people using it.  That will have the long term of stability you are looking for.

There are several large exchanges that handle bitcoin right now, and many smaller ones.  As long as there are several, all of the buy and sell orders for a day can be combined to get an idea of whether or not there is currently demand for more altcoins or not.  If the demand exceeds tomorrow's price target by more than 2%, then additional reward coins necessary to bring the price increase down to 2% are divided up evenly (per number of MH-hours) among those who've been performing proof-of-stake work since the last reward coins were issued.

The exchanges are centralized authorities. I don't think that 's a good idea to give them the power to halt or resume coining based only on a price index.

nw, I feel like you're arguing something that I'm not discussing.

Someone has to break the cycle of unlimited volatility.  If it is possible to have an altcoin recalculate its relative price in terms of purchasing power each day and make adjustments to its own operation, then it makes sense to create such a coin.  Of course, it would grow in value less that the more volatile altcoins, but it would be safer over the long run.

welcome to the real world.

In every market there are people with large shares and people with very little, and those with lots will always gain more from even the smallest manipulative movements.

You cannot change this.

The theoretical answer is to limit ownership of coins to one per person, but the practical answer will be the formations of cartels of unions to try and built some power of manipulation within an unnatural vacuum.

Everyone had a chance to get in on the bottom ladder and buy thousands of coins when they were a few cents each. The fact that now those investments are showing a return should not be used as a reason to fine risk takers.

When there is a large buy in, whether it be for pump&dump or a buy-hold position, the ideal altcoin would somehow build up its own reserves, perhaps holding a mix of bitcoins and altcoins in its own Block Chain.

I've proposed a small pre-mine AND a parallel mine of 5-10%, in which an altcoin holds a reserve of both itself and other crypto-currencies encrypted in its own Block Chain.  When there is a sudden sell off of FIXEDtoken's, a consensus would be built up in the peer-to-peer network, recording the sell off and authorizing the sale of some of the bitcoin/altcoin reserve to take FIXEDtoken's out of circulation.

The problem is that there is minute-by-minute volatility is not the same as day-by-day selloffs.  Long term depreciation/inflation needs to addressed with a different mechanism, like adjusting the total number of coins mined.  For daily volatility, the Reserve could put in place a set of buy orders 2% below a Price Target, with a series of sell orders placed 2-4% above that target.  For day-to-day volatility (which entails larger volumes of selloffs), the program tightens down on the reward chain for CPU-GPU miners, since that can be recalculated daily.

You are correct of course...but the problem with Crypto atm is that the market size/cap is small and the majority of supply is spread over only a few holders.

Those holders then have the power to manipulate a market greatly, which leads to large profits for them, which hardens their grip over the market, which in turn causes large value swings daily, which blurs the real long term value of the currency.   (lots of whichs)

Isn't this exactly what we have at the moment?

The gains go to the owners, while the loses are taken by everyone - that sux!

The whole point of a value is that its shorthand for the faith people have in the product.  If you think its worth what its priced at, you buy it, but if you don't you offer less.  If when you offer less, but its not available for less, nobody is going to buy it, and its price will be wrong.

What is being suggested is that a coin will have a value that is above its market value.  All this does is give owners the idea that they have a valuable product, but one they can't sell. That is more like a white elephant!