Recheck our belief on PPC/XPM

General
1

The price is so low because neither PPC nor XPM could adjust their supply according to real world demand, wake up buddies, we must comply basic economics rule of demand and supply at first if we wanna the real world accept our coins, please sunny king and other developers think twice about it.

The volatile coin never never become a real currency, is this the consensus? If so, I"ll stay in this community, if not, I don’t think IT programmers, most of them are economics laymen, could rewrite the history of curency, neither is Bitcoin and satoshi!

2

Interesting - can you elaborate?

3

Sabreiib, why do you keep referring to Peercoin as a currency? I don’t know many people who still believe Peercoin is destined for day to day transactions. If people believed Peercoin was supposed to be a currency then our focus would be on gaining adoption with merchants, which it isn’t. If Peercoin isn’t supposed to be a currency, then your concerns here don’t even apply.

I want to refer once again to my thoughts on the matter, something I previously posted in two other threads…

[quote=“Sentinelrv, post:8, topic:3215”]

PPC does not store value reliably

Peercoin stores value in a more sustainable way compared with proof-of-work, but Tomjoad is right that Peercoin doesn’t store value reliably in a price stable way. That’s what NuBits is for. But maybe this is the way it’s supposed to be though. Maybe Peercoin was never meant to be money or a day to day transactional currency? Bitcoin has always tried to be a currency, but this will never happen as long as it has its volatility. NuBits could end up taking over the currency role from Bitcoin in the future.

Peercoin supporters also originally thought Peercoin was supposed to be a currency in the very beginning, but then that viewpoint slowly changed over time. At first people wondered how Peercoin could be used as a day to day currency because of the fixed transaction fee. The fee would prevent microtransactions. We finally realized that off-chain networks like Open Transactions could allow us to bypass the fee and it was something that Sunny hinted at in his interviews.

That answer satisfied us for a while until the release of NuBits, when we all realized how unlike a currency Peercoin really was. Sure, we could still use OT to bypass the fee, but why use Peercoin as a transactional currency or store your money in it if it sways in price? You can’t store money in something that is volatile. Sure, proof-of-stake will ensure that your money is always stored securely and in a sustainable way, but how much will the value of that money change by the time you go to retrieve it? Because of this, I don’t think many people believe that Peercoin is destined to be a currency anymore.

So without the currency role, what is Peercoin good for? That’s the $1 billion dollar question! I sure wish Sunny would chime in on this. Maybe the answer lies in building things on top of Peercoin through sidechains? In this way, Peercoin would become similar to NuShares I think. The NuShares blockchain is like a backbone from which pegged currencies and other assets can be built on top of. The value of the entire NuShares network and everything built on top of it (all currencies & assets) is displayed in the price of individual NuShares.

Owning Peercoin would be similar to owning shares in the network. Peercoin would be the backbone of the network, while all the exciting stuff gets built on top of it in the form of sidechains. Sidechains would prevent the main blockchain from growing too much in size, unlike the NuShares blockchain where everything is under one chain. With more useful things being built into Peercoin sidechains that satisfies different needs, the value of the network itself will rise and that will be displayed through the rising price of individual Peercoins.

I’m basically just throwing out ideas here. I’m not totally sure how all this would work, but it should give Peercoin its own purpose outside of the currency role.

I think many people are realizing this. Progresses (if technically obscure) have been made in this direction such as OP_RETURN and ppcd by the developers.

An advantage of peercoin is that it is similar to bitcoin except for the POS part. For better or for worse peercoin is The POS Version of Bitcoin. Many features made on top of the bitcoin network can be relatively easily ported to peercoin. This cannot be said on other POS coins such as nxt.[/quote][/quote]

4

There are still people that belief that in the very long term cryptocoins as Bitcoin, Peercoin and maybe even Primecoin can still serve as a currency. This is when major fiat currencies start to hyper inflate. In that case some solid free floating crypto coins can be seen as an alternative. In such a scenario NuBits would get quickly worthless being pegged to that very same fiat currency, unless they peg to something different.

I don’t think this will happen in next 5 years or so and if it does we have probably other serious problems to look after ::slight_smile:

5

It can put very simple:

The Dollar is a currency. It can be confiscated from your account by various actors, and it can be inflated and deflated by individual actors (the Fed). Even Banknotes could be declared invalid.

Nubits is not a currency yet, but it could become one. It can’t be confiscated. However it can be inflated and deflated by individual actors (the Fed).

Bitcoin and Peercoin are not currencies. They are rare items like precious metals that are still very young. They can’t be confiscated, inflated or deflated by individual actors, but the price is highly volatile.

Gold/Silver are not currencies, they are rare items. They are hard to confiscate, and can’t be inflated or deflated by individual actors. Their price is volatile, but not as much as Bitcoin/Peercoin, because of their long history.

A true cryptocurrency does not exist yet. It would need an emission-schedule that depends on real-world adoption. Also, a true cryptocurrency would need to have a much bigger infrastructure than bitcoin, and be easier to use and store.

6

Hi sentinelrv, have you shared your idea with SK?

You believe PPC is something like Nushare, I admit it. So could we change peercoin/Primecoin into peershare and primeshare, because the name of “coin” is quite misleading.

Here is my two cents

POS is ideal for share concept, for a “share”, there is nothing to do with"rich gets richer, fair distribution" sort of things. I really believe POS is just Mr. Right for share concept! POS is ideal for voting too.
While POW is not suitable for share concept because the existing coins have no right to mint a block(vote), POW is only suitable for new coin/share minting. A solo POW such as BTC is not sustainable in a long run.

So the battle between POW and POS should end because they supplement each other, a pure POS or a POW+POS hybrid system are both OK.

For primecoin, although it can last longer than BTC, can not support the share concept so I strongly suggest SK to make Primecoin hybid with POS+POW.

With share concept, we can issue more financial product such as real currency, that’s a good money.
Either pegged to fiat or antiinflation is feasible.

Why not issue new coins on the top of PPC network? I mean PPC itself becomes peershare and issue new stable currency!

7

The calculation of prime chains, XPMs unique selling point, requires proof of work.
Blending in proof of stake would give you some blocks, which contribute to scientific endeavours, and some blocks that don’t.
I don’t really see the point of this.

8

unless you can make a pos calculation system to search for primes
or other sceintific things. but you would always need some hardware “eating”
power for these types of calculation, or not?

9

Peercoin’s a backbone “currency”. It will replace things like ACH and Wire Transfers.

Payment gateways (perhaps more like Ripple, perhaps more like BitPay) will be where the majority of transactions take place for Peercoin. This is incentivized via the hard-coded tx fee.

Price right now is reflective of whales manipulating the market between altcoins + bitcoin on exchanges like btc-e. If a coin is interesting to the cryptocurrency community, causing little fish to buy/sell it, whales can step in and make money off that by swinging that coin’s price up or down. If the little fishes don’t outweigh the whales (as is the case with Peercoin trading), the price is pretty much determined by the whale’s trading bot algorithms, and nothing else.

Long-term, as Peercoin transaction volume increases, Peercoin’s price will stabilize somewhere where the 0.01 fee will be what people are willing to pay for an on network transaction. This will likely be somewhere between the two extremes of a few pennies and a $25 wire transfer - probably settling in the ATM withdrawal fee range of $1-$2.

Ignore price - watching a ticker each day only gives the whales power over your emotions.

10

[quote=“Ötzi, post:5, topic:3273”]It can put very simple:

The Dollar is a currency. It can be confiscated from your account by various actors, and it can be inflated and deflated by individual actors (the Fed). Even Banknotes could be declared invalid.

Nubits is not a currency yet, but it could become one. It can’t be confiscated. However it can be inflated and deflated by individual actors (the Fed).

Bitcoin and Peercoin are not currencies. They are rare items like precious metals that are still very young. They can’t be confiscated, inflated or deflated by individual actors, but the price is highly volatile.

Gold/Silver are not currencies, they are rare items. They are hard to confiscate, and can’t be inflated or deflated by individual actors. Their price is volatile, but not as much as Bitcoin/Peercoin, because of their long history.

A true cryptocurrency does not exist yet. It would need an emission-schedule that depends on real-world adoption. Also, a true cryptocurrency would need to have a much bigger infrastructure than bitcoin, and be easier to use and store.[/quote]
Agree!
A volatile asset can never become real currency which demands stable value being a unit of account.

We are pretty close to the real crypto curency which is neither infaltion or deflation.

11

The calculation of prime chains, XPMs unique selling point, requires proof of work.
Blending in proof of stake would give you some blocks, which contribute to scientific endeavours, and some blocks that don’t.
I don’t really see the point of this.[/quote]
My XPM just sleeping there without any contribution to network, we need a share unit, that can only achieved by PoS, the XPM pow is still there producing new XPM and contribute to mathematics.

The most important thing for crypto system/DAC is voting, while those with powerful minting rigs but little coins have more vote right than large XPM holders, that’s very bad.

12

[quote=“seki, post:8, topic:3273”]unless you can make a pos calculation system to search for primes
or other sceintific things. but you would always need some hardware “eating”
power for these types of calculation, or not?[/quote]

I mean let XPM minting rigs continue to compute prime number, and let existing XPMs contribute to network security, thus XPM becomes a prime number version PPC.

13

[quote=“emeth, post:9, topic:3273”]Peercoin’s a backbone “currency”. It will replace things like ACH and Wire Transfers.

Payment gateways (perhaps more like Ripple, perhaps more like BitPay) will be where the majority of transactions take place for Peercoin. This is incentivized via the hard-coded tx fee.

Price right now is reflective of whales making manipulating the market between altcoins + bitcoin on exchanges like btc-e. If a coin is interesting to the cryptocurrency community, causing little fish to buy/sell it, whales can step in and make money off that by swinging that coin’s price up or down. If the little fishes don’t outweigh the whales (as is the case with Peercoin trading), the price is pretty much determined by the whale’s trading bot algorithms, and nothing else.

Long-term, as Peercoin transaction volume increases, Peercoin’s price will stabilize somewhere where the 0.01 fee will be what people are willing to pay for an on network transaction. This will likely be somewhere between the two extremes of a few pennies and a $25 wire transfer - probably settling in the ATM withdrawal fee range of $1-$2.

Ignore price - watching a ticker each day only gives the whales power over your emotions.[/quote]

Emeth, how can a volatile asset become a backbone currency? Assume that in future nubits do very well in daily trading/micropayment, why cannot Nubits become a backbore currency simultaneously? PPC isn’t suitable for micropayment, but that doesn’t mean other micropayment suitable cryptos could not play role of backbone, on the contrary, people will ask why PPC exists since they have a very good crypto that’s good at both micropayment and backbone.

Medium of exchange, store of value, unit of account, that’s the three hardcore functions for currency, among them, unit of account demands most stability while btc/PPC/XPM cannot meet this requirement. If they fails in becoming a decent currency, they fail totally because if the next generation cryptos are good currency, they are naturally asset and backbone currency. Don’t forget they may utilize off chain trading platform like open transaction to avoid blockchain oversized. A low trade fee backbone currency outperforms the high fee ones.

14

In short: my take is that the Nu network needs to be economically sound (in addition to technological aspects) to be able to pave the ground for NuBits being considered a backbone currency.
As the PoS used by Nu is forked from Peercoin’s, it basically inherited the strengths (and weaknesses) of Peercoin. We need to see how Nu is different from Peercoin; it’s not open source yet, though.

Peercoin only needs to be sound with regards to its technology - and that doesn’t look so bad considering that Peercoin is running stable since August 2012 while Nu is running for close to 4 months now.
Nu has economical requirements as well.

Peercoin is secure and sustainable- as we know :wink:
Peercoin is the safer bet imho.

15

todo: replace then with than

Google tells me that currency (http://en.wikipedia.org/wiki/Currency) is money (http://en.wikipedia.org/wiki/Money) in circulation. Fiat money (http://en.wikipedia.org/wiki/Fiat_money) is currency declared so by the state, i.e. if you have a store you have to, by law, accepts the fiat and you have to pay tax in it as well.

A major reason why dollar is the dominate reserve currency, is because the US bond market (http://en.wikipedia.org/wiki/Bond_market#U.S._bond_market_size) is the worlds most liquid debt market with enough depth to absorb huge amount of money. I.e. if you have a whole lot of money and want to park it somewhere, you want to put is somewhere where you get an interest and where you can buy and sell huge amounts at any given time, without moving the price.

So what have we learned? Currency is money that is used a means of exchange. To make a currency popular, you have to create huge amount of liquidity and depth in the market (if you don’t you get the kind of volatility that we have in most cryptos right now). You also have to pay some kind of interest on the debt, so that the lender is rewarded for taking the risk.

A cryptocurrency is a kind of digital money, that is being used as a medium of exchange, i.e. its circulating in the economy (true to some degree, hopefully more true in the future). If Peercoin is going to be a reserve cryptocurrency, it will have to offer the depth and liquidity necessary for big money to move in. It competes with Bitcoin. Right now Bitcoin does not offer the depth and liquidity necessary for big money to move in either, but Bitcoin has the network going for it, which is major deal.

My foremost reasons for accumulating peercoins are that I believe that Peercoin will be cheaper to transact with then Bitcoin. If Peercoin can do all the things that Bitcoin can, but at a cheaper price, people will gravitate to using it more then Bitcoin. Peercoin can be cheaper to use then Bitcoin, because it doesn’t use Proof-of-Work. I.e. the cost of securing the network with Peercoin is cheaper then Bitcoin, hence the cost should also be lower in the future.

If Peercoin was super inflationary and offered no protection against the inflation, it would be a very bad place to store purchasing power. While the inflation rate now is very high (in 10 years half of your purchasing power in peercoins should go away, all else being equal) compared to some other cryptos (say those that were 100% pre-mined, which is a major bad thing in itself - think of the ripples tanking on the mere news of a big hodler thinking about dumping), the inflation rate is likely to go down in the future and right now the peercoins are so cheap, that it compensates for the inflation (my personal opinion).

Just as with the US bond market, entities that park/save money, want an interest. In Peercoin you do get an interest on the money, that compensates for the inflation in the currency supply.

Peercoin as a (technical) backbone crypto currency, makes sense to me because it should be very cheap to use Peercoin to do such things (because of PoS). Things such as Factom (http://factom.org/) would be cheaper to use, if it was not dependent on a PoW secured blockchain (at least theoretically it could be ). Burning Peercoin, depletes the existing supply of peercoins and is another way of moving value from Peercoin else where.

Also a major flaw with Bitcoin is the economies of scale, where PoW results in centralization and the even worse bastardization with cloud based mining contracts. Bitcoin is not decentralized and is moving away from that model. Proof-of-Stake, being more cost efficient, is the best and only viable alternative that I know of.

So basically, I buy peercoins not because it think its a good alternative to Bitcoin that could exist as a backbone currency somewhere in the “background”. I buy peercoins because I think that Bitcoin, in its current implementation, will eventually either fail or be more expensive to use.

I.e. in my opinion Peercoin , although Peercoin could serve as a backbone currency, it is going to move to the for front of the ecosystem (and only then will it work as a reserve crypto currency).

edit: oh and I don’t expect this to happen tomorrow or even next year. I think it will take much longer then that. However, we got time because peercoins sustain the network at basically no cost (besides the devs maintaining it) and the longer the time, the better the coin distribution and the greater the decentralization. i.e. time is favoring Peercoin.

16

Very good points pillow.

[quote=“sabreiib, post:10, topic:3273”]Agree!
A volatile asset can never become real currency which demands stable value being a unit of account.

We are pretty close to the real crypto curency which is neither infaltion or deflation.[/quote]

Peercoin high volatility is a temporary factor.
If peercoin doesn’t fail and its market cap becomes huge its liquidity will also increase a lot and its price will also become very very stable.
This is not state debt, this is not a stock or a commodity, this is a protocol and that means that both its value and its price can potentially become very very stable one day.
I can imagine PPC with a market cap higher then 1 trillion $, a lot of people in the world using it as a store of value, a place where you can hide and preserve your wealth without politician being able to inflate or confiscate it.
The network will be very robust with hundreds of thousands of nodes all around the globe, it will be very distributed and it will probably be impossible for one entity to gain control of more then 1% of total coins available.
In the above scenario there’s no reason to believe peercoin price will be volatile at all, i’m sure it will be very very stable and all PPC holders will benefit from a costantly increasing purchasing power, that is because PPC supply will be stable or very low inflated but increase in productivity will costantly push down prices of goods mesaured in PPC.
It will be a new renaissance, something most of the people used to be robbed via inflation can’t even imagine today.

17

Oh and one more thing. I think its worth pointing out the difference between PoW and PoS. The economics are different so the death spirals are also different I think. If the coins becomes worth less in PoW, there is “no point” to mining and securing the network because there is no profit and perhaps even not enough reward to pay for the energy needed. However, if you bought peercoins at $7, there is 7*the_number_of_coins_you_bought to keep securing the network.

18

If it’s true that higher liquidity in Peercoin will eventually stabilize its price, then I think NuBits will act as the stepping stone toward mainstream crypto adoption. In order to get mass amounts of people to use crypto, we need an in between step, something that is already familiar to them, a crypto that is the same exact price as the dollars in their wallets and bank accounts. NuBits fulfills that role and would help start a transition for people from fiat money to cryptocurrency. These two systems would co-exist side by side for a while, but Peercoin would be inevitably be the next logical step, as long as the price stabilizes as people predict. NuBits would end up becoming obsolete in the end as people discard their fiat money for Peercoin. There would be no reason to continue maintaining the peg. Does anybody agree that this is the way it could happen, NuBits as a stepping stone to Peercoin mass adoption?

19

Sentinelrv, agree 100%. NuBits would operate as a gateway drug.

20

Also, interesting historical thread from bitcointalk on a similar topic, with responses from satoshi:
https://bitcointalk.org/index.php?topic=57.0