entity · derived
Reserves
Derived node: assembled mechanically from the claims carrying reserves. A roster, not an adjudicated definition.
Every claim under this term
- 3067615-039 : ICO disclosures should be as clear as possible: promoters should avoid an unclear or uncertain use of proceeds pie chart and should be very clear on plans for converting cryptocurrency into actual com
- 3402701-017 : Reserves, not bonds, are the necessary mechanism for currency instability caused by hot money, that is money frequently moved between institutions or currencies to maximize gain.
- 3402701-018 : Because most of the value of contemporary cryptocurrencies comes from speculation on future uses that do not yet exist, the vast majority of cryptocurrency is technically hot money, and reserves are t
- 3402701-019 : Selling currency into a reserve when price is above the peg and buying it back with the reserve when price is below the peg yields an arbitrage profit, so a reserve can fund its own defense of the peg
- 3402701-020 : The reserve argument depends on two requirements, and failing either one grounds a criticism of an existing protocol: the stable-value requirement criticizes MakerDAO and the maintenance-cost requirem
- 3402701-023 : Determining what fraction of a currency is hot money is necessary for efficient defense of its stability, because the reserve requirement follows from that ratio rather than from a blanket full-backin
- 3402701-024 : Misestimating the hot money ratio fails in both directions: overestimation makes the currency more costly to use, and underestimation leaves it insecure, so efficiency and security are in direct tensi
- 3402701-030 : For any long-lived currency, a major shift in perceived value is eventually inevitable, and such a shift is not covered by reserves defending against hot money or by bonds defending against temporary
- 3402701-035 : Transparency is not an unqualified good for monetary policy: a currency only partially backed by reserves can be arbitraged by a Soros-style shorting strategy much more easily when the quantity of res
- 3782216-029 : Maintaining a full reserve is too expensive to be efficient, because every unit of reserve value backing the currency must be held liquid or arbitrage attacks become possible, and liquidity forgoes in
- 3782216-031 : Contrary to the industry practice of full backing, a full reserve is not always necessary, because a currency also has intrinsic worth derived from the authentic economic activity it represents.