# kaal:claim:3266953-012

**Claim.** Because power exercised over a store of value inevitably produces economies of scale, cryptocurrencies and any other transferable store of value drive networks toward centralization.

**Type.** mechanism  **Support.** argued

**Holds when.**

- any fungible store of value, not only cryptocurrencies

**Source quote.**

> Because of the store of value entailed in cryptocurrencies (and really any currencies or store of value), exercise of power over such value inevitably leads to centralization due to economies of scale.

**From.** Craig Calcaterra, Wulf A. Kaal, Gopinath Sivalingam, *Reputation Protocol for the Internet of Trust - Conceptual Whitepaper* (2018), Reputation as True Decentralization, page 10

**Cite as.** Craig Calcaterra, Wulf A. Kaal, Gopinath Sivalingam, Reputation Protocol for the Internet of Trust - Conceptual Whitepaper (2018). SSRN: https://ssrn.com/abstract=3266953

**Verify.** sha256 of source PDF `781758dea356e55d79c73ad7f1debe7c83de398bd1cd9e0a9a6c2802f276b4c0` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Calcaterra%20et%20al.%20-%202018%20-%20Reputation%20Protocol%20for%20the%20Internet%20of%20Trust%20-%20Conceptual%20Whitepaper.pdf

**Failure mode.** value transferability drives centralization  (family: recentralization-drift)

**Topics.** decentralization, economics

**Keywords.** centralization, cryptocurrency, store-of-value, economies-of-scale

**Related claims.**

- restated_by: https://wulfkaal.github.io/claims/3405401-023
- extended_by: https://wulfkaal.github.io/claims/3411897-028
- extended_by: https://wulfkaal.github.io/claims/3406323-023
- extended_by: https://wulfkaal.github.io/claims/3405401-021

**Canonical form.** This markdown file is the canonical hashed representation of the claim. Its sha256 is the content hash used for attestation.