I was listening to @crypt0's show earlier today and briefly $GRIN was mentioned. For those of you that don't know about $GRIN it might just be enough to say it's one of those tokens that is swimming against the current. When compared to almost all other crypto, it's inflation is very high and it uses a very different technology to achieve privacy.

There is something to be said about how we, those of us who are deeply involved in crypto, see "the inflation". It's almost a given, that we've chosen to adopt cryptocurrencies so early in the game, because we understand how the corrupt governments have robbed us of our wealth. We currently live in a system where gains are privatized by our financial institutions but loses are socialized.

In other words, when Banks make "good moves" and bring in a lot of money, none of that or very little of it, is shared with the population. But, when they make a huge mistake, it's up to us, the taxpayers to bail them out. This fact, this observable and obscene fact, has made us reject entirely the concept of an inflationary currency. We now understand how they've robbed us, and thus have lost trust in the word inflation.

We do have to question however, if the idea of an inflationary currency has merit at all. Of course, let's put aside corruption, let's put aside cronyism and the valid criticism we have for the legacy monetary system. Let's isolate for the sake of this mental exploration this one single point, and explore the notion that maybe there's something of value here.

Is inflation a bad thing?

Which is really the question I present to you. What does an inflationary currency allow an economic system to do? What does it promote? What does it deter? - You see, these are very important questions, since they should be the foundation for any economic system as it's being proposed and built.

The truth is that inflationary currencies do promote one thing, and do a really good job at it; They promote commerce. It's something we can study, and the information is widely available. As it turns out a healthy inflation rate makes people spend money and participate of the economy. Even though GDP (Gross domestic Product) is a blunt tool to measure an economy, it does measure activity, and it's not a crazy thing to say that a low GDP on a economic system would surely translate into weak economy.

You see, this very fact can be disconnected from wealth. It's not too hard to imagine a society that hoards or hodls their currency a little too aggressively, thus literally affecting the economy in a negative way. We have seen this in practice, although very much separated by social classes, where the people with resources take themselves out of the economy all together.

Understanding this dynamic, and this psychological tendency we have as humans to hold on to things that are not easily replaced, can give us a insight into the positive aspects of an inflationary currency. If the inflation is small enough as to promote transactions and work, without losing it's value too abruptly, it can work as a great incentive to stimulate any economy.

It would be also prudent to mention, that an inflationary system does not need to exist by itself, and it's completely reasonable to have a non inflationary store of value work in tangent with it. Which is to say, that the surplus of a business well built, of an entrepreneur making waves, can easily and safely be stored away.

In short, I think we need them and I have no doubt that those who are writing code today, coming up with new projects that integrate social media and cryptocurrencies are thinking along the same lines. We need something that can stimulate humanity, without making people fear that if they spend, they have no way of making that value back again.

MenO