1. There's nothing at the code and protocol level about sustaining the price, but at the human level the early adopters (i.e. the 4% owning 97% of assets) are incentivised to try to sustain or increase the price through whatever means they can (e.g. funding pro-crypto press, social media, lobbyists etc.).
2. There's a big debate about whether it is inflationary, or deflationary, or hyper-deflationary, or different things at different times (e.g. inflationary wile new coins are being mined and deflationary from when the maximum number of coins has been reached). But whatever you call it, the point is that if there are the same people holding assets and there are more of those assets enabled, then all else being equal each of those assets would naturally be worth less, and as per point 1 the people at the top are incentivised to take action to counteract this, e.g. by introducing more people into the system below them.
>"There's nothing at the code and protocol level about sustaining the price, but at the human level the early adopters (i.e. the 4% owning 97% of assets) are incentivised to try to sustain or increase the price through whatever means they can (e.g. funding pro-crypto press, social media, lobbyists etc.)."
Ok, but this is trivial. It is true for everything for which there is a market. And both early and late adopters have the same incentive to increase the price. Why does the timing matter to you?
>"There's a big debate about whether it is inflationary, or deflationary, or hyper-deflationary, or different things at different times"
Who is debating this? It seems pretty straightforward that creating new coins is inflationary.
>"if there are the same people holding assets and there are more of those assets enabled, then all else being equal each of those assets would naturally be worth less"
Yes, this is literally the definition of inflation, I don't understand how someone can debate that this is actually an instance of deflation. "Worth less" == Prices (of other things denominated in the cryptocurrency) go up. I see no room for any disagreement about this: https://en.wikipedia.org/wiki/Inflation
>"the people at the top are incentivized to take action to counteract this"
Isn't anyone holding the currency incentivized to do the same? What does "at the top" matter?
>Who is debating this? It seems pretty straightforward that creating new coins is inflationary.
It is enabling coins within a fixed supply of 21M - this is not the same as creating new coins with no upper bounds. It isn't my intention to debate terminology - as I said "whatever you call it, the point is..."
>Isn't anyone holding the currency incentivized to do the same? What does "at the top" matter?
Those with more wealth to lose are disproportionately incentivised to protect it, and those with more wealth are also disproportionately empowered to take action to protect it. I used the term "at the top" to allude to the original point about what geometric shape a reasonable person would be likely to use to pictorially represent such a scheme.
The fixed coin supply is totally different from the inflationary pressure you are concerned about. There seems to be some kind of confusion here but I can't figure out what your are trying to say now.
>"Those with more wealth to lose are disproportionately incentivised to protect it"
I'd think a billionaire with $1 million worth of cryptocurrency would be less incentivized than someone with no other "wealth" but $10k worth of cryptocurrency. Also, the people with the most non-cryptocurrency wealth are going to be most empowered to take "protective" action. The "cryptocurrency wealth" is tied up in cryptocurrency... So I can't really follow this argument of yours either.
>"what geometric shape a reasonable person would be likely to use to pictorially represent such a scheme"
Yes, you seem to have started with the conclusion that you have problem with cryptocurrencies, and then are coming up with false arguments to call them a pyramid scheme.
> 'I'd think a billionaire with $1 million worth of cryptocurrency would be less incentivized than someone with no other "wealth" but $10k worth of cryptocurrency.'
Precisely. And in the context of this discussion, almost all crypto is held by people who have most of their wealth in crypto (e.g. 97% held by 4% of addresses) - using the percentages in your example, there aren't any crypto billionaires who have a trillion in cash. Linking this back to the original point, the are forced to keep most of their wealth in crypto because if they sold large amounts they would crash the market, hence one of the reasons for the need for new buyers so they can sell in a trickle.
> 'Also, the people with the most non-cryptocurrency wealth are going to be most empowered to take "protective" action. The "cryptocurrency wealth' is tied up in cryptocurrency...'
If you've a billion US$ worth of crypto, selling the odd million US$ worth to fund whatever you need to do in order to sustain the scheme (or "build the ecosystem" to use the euphemism) isn't a big issue. Not to mention that in many cases the people you are paying have been converted into "true believers" (perhaps even as a result of your own earlier efforts) and can therefore be paid in crypto.
2. There's a big debate about whether it is inflationary, or deflationary, or hyper-deflationary, or different things at different times (e.g. inflationary wile new coins are being mined and deflationary from when the maximum number of coins has been reached). But whatever you call it, the point is that if there are the same people holding assets and there are more of those assets enabled, then all else being equal each of those assets would naturally be worth less, and as per point 1 the people at the top are incentivised to take action to counteract this, e.g. by introducing more people into the system below them.