2021 NABIG Talk - An Algorithmic Monetary System Based on UBI and Demurrage

Bitcoin has shown that a purely rule based monetary system can be implemented using blockchain technology. The benefits of such a system for its participants include long term predictability of the money supply and no need for human intervention to control the supply. However, Bitcoin’s simple rule of a hard limit on the long term total money supply leads to deflationary economics resulting in unstable pricing of goods and services as the number of participants in its economy grows. Price volatility leads to difficulty in using Bitcoin for everyday transactions. A system that preserves the rule based predictability of the money supply while allowing for stable prices would be useful for global commerce and trade. We define the money supply rules of the GETCoin monetary system which is designed to be self stabilizing such that there is no inflation or deflation. By giving individuals a universal basic income and applying a demurrage rate to the money supply, it is able to maintain stable prices even when the number of participants in the economy grows or shrinks. We also define a temporary peg rule to help reduce the price volatility when the number of participants using the system is small. The system can be implemented using distributed ledger technology so there is no dependency on any single entity. ... https://www.youtube.com/watch?v=ApED9FvgxSc