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Jacek.degen.eth 🎩
@jacek
Not an economist (obviously), but M1 money supply increasing 5x is wild, right? Hard to see interest rates dropping after such a cash surge. Next few years might be tough economically. Glad we haven't rushed hiring at $DEGEN. Surviving with cash in hand might beat fast growth with no runway.
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Juli 🎩↑
@juli
Now do $degen money supply
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Jacek.degen.eth 🎩
@jacek
Our supply has been 36,965,935,954 since day one. While the circulating supply may differ, the total supply was always known upfront. There are no inflation effects like with the dollar. 🎩
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Pia
@mrpiano.eth
Causing inflation in a token involves increasing its supply in the market, which generally reduces its value if demand does not grow proportionally. Releasing a quantity of DEGEN without demand causes inflation. We are not talking about whether DEGEN is inherently inflationary, which is a different matter. The strategy that has been used is inflationary: putting more DEGEN into circulation than the demand dilutes the capitalization, which is an inflationary process.
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Jacek.degen.eth 🎩
@jacek
Even so, compared to the dollar's 5x supply increase, each airdrop only adds about 1-2% of the token supply to the market. If we take a step back, the initial airdrop was 15% of the token supply, and now we've got 50% of the total supply circulating. We're still doing better than the dollar in that sense. Plus, markets are forward-looking; when the Fed announces a rate cut, the market reacts right away, not just when the rate cut actually kicks in.
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Pia
@mrpiano.eth
Remember that you can't compare the dollar to a token. The dollar's value is based on the economy and the dominant superpower that is the United States. In contrast, the value of tokens is based on speculation, usability, and trends, which is why they tend to be more volatile. I believe DEGEN can have an incredible future because, although there are tokens that offer nothing and are at the top, DEGEN has usability here on Farcaster. A deflationary strategy would also help a lot to revalue its price.
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