Hi Eric,

Your cryproeconomic theories may describe correctly Bitcoin as money, but fall short of describing a Bitcoin that would also offer reliable memory for other uses.

In consequence you miss, that:

1. If the reliable memory that enables money would have more uses then even temporary use of the memory would have utility, therefore value. Bitcoin as is, does not have consensus rules to enable reliable alternate uses.

2. Finite supply of coins implies a finite memory capacity of Bitcoin. Alternate use of the memory requires that units at least temporarily become un-fungible, enforced by consensus. Alternate uses would then have to compete for units of memory, which would give rise to a price paid to those enabling alternate use, even if temoprarily.

3. If giving up control temorarily has a positive price (through 2) and return of control is certain (enforced by consenus) then the price paid is riskless interest for those giving up temporary control.

4. If a use requires more units of memory then it imposes higher cost to use and it since memory units are finite it imposes more severe scarcity.

Further certainly subjective remarks:

Although burning and loss is unavoidable and therefore Bitcoin (as is) is unsustainable we should design systems that they sustain it as long as possible (as is). Therefore a requirement to burn for any of unlimited number of uses should be avoided.

We currently perceive borrowed money just as good as (fungible with) any other money. This is a consequence that money actually comes into existence through someone borrowing it. Money on your account is a loan you gave the bank and even paper cash is a loan you gave the central bank.

Bitcoin is different as it just is, it is not borrowed into existence. Therefore it is not fungible with borrowed version of itself. This however does not imply that its borrowed version is worthless as it might be worth something if there is a use for it.

Tamas Blummer

> On Jul 7, 2019, at 03:30, Eric Voskuil <eric@voskuil.org> wrote:
> 
> I have published a summary here:
> 
> https://github.com/libbitcoin/libbitcoin-system/wiki/Risk-Free-Return-Fallacy <https://github.com/libbitcoin/libbitcoin-system/wiki/Risk-Free-Return-Fallacy>
> 
> Barring any new consequential inputs I’ll refrain from further comment.
> 
> e
>