kaal:claim:3402701-014

A Basis-style bond scheme succeeds only while demand for the currency grows at a sufficient rate; the authors' simulations show it fails when demand is stagnant at equilibrium.

Source quote, verbatim

According to our simulations, this scheme will succeed as long as demand for the currency is growing at a sufficient rate, but it will fail if the demand is stagnant at equilibrium

From

Craig Calcaterra, Wulf A. Kaal, Vadhindran K. Rao, Stable Cryptocurrencies - First Order Principles (2019), 3.1.2.1 Bonds, p. 18
https://ssrn.com/abstract=3402701 · source PDF

Cite as

Craig Calcaterra, Wulf A. Kaal, Vadhindran K. Rao, Stable Cryptocurrencies - First Order Principles (2019). SSRN: https://ssrn.com/abstract=3402701

Holds when

demand stagnant at equilibrium

Classification

failuresupport: evidencedfailure: stagnant-demand-bond-failurefamily: valuation-and-pricing-failureinstitutional-design

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