One of the best solutions I can think of is that when someone makes a purchase for a service or goods. is to immediately switch to a stable asset, if you had an app to make that switch automaticly would be good. Prices for goods or services could be set to for example USD and then have an automatic conversion to current exchange price.
There are absolutely compromises and the customer could solve the problem by exchanging parts of their assets to other stable coins on exchanges if they want less risk of price fluctuations, maybe to USDT or similar. One thing is certain, a seller that risk losing money on every deal won’t be selling services or goods any longer. There will probably be several different ways to solve the problem but it will be with a high certainty solvable, from what I understand.
The obvious hedge would be a market in PUTs (storage). So if that becomes transferable it would be a very simple way to solve this so long as PUT balance proves secure enough. In the network it is just data, so not much problem there, on the client the risks would be the same as any wallet (including Safecoin) so at first glance this seems to do the trick.
Safecoin is tradeable, so PUTs are effectively tradeable in the form of safecoin. Which, I think, already handles what you’re suggesting. My off-hand analysis below
Assuming the network only sells PUTs-per-safecoin on an as-needed basis, I think the following are the relevant factors militating for safecoin to hold a fairly (and generally deflationary) stable value:
Safecoin requires proof of resource to be earned.
Safecoin is transactable on the network at any point for a quantity of PUTs at that time.
That quantity is dynamic based on network conditions but is unlikely to be extremely volatile and will, I think, trend up (i.e., more PUTs per safecoin).
While there will certainly be a speculative value based upon other attributes of safecoin (speed of transaction, anonymity, etc.), it will always have a real-time peg to a tangible, checkable asset (number of PUTs per safecoin).
I can’t think of any other form of currency that could have a more transparent, assessable peg. Gold and silver are pretty good, but that depends on storing the underlying asset and trust that the holders aren’t breaking trust (which they are pretty well incentivized to do eventually). This always goes wrong eventually because trust in the availability of the tangible asset is always dependent upon a rather centralized set of people/organizations/states.
Safecoin, on the other hand, is anchored in a commodity that almost everyone will have use for, is assessable by everyone, is farmable by a huge cross-section of the population, is out of the control of any centralized entity.
Bitcoin and other cryptos have some of the speculative value, but no real-world, easily-assessed stabilizing metric.
A PUT to the network is using safecoin. As is farming. Safecoin will be volatile. So yes farming regulation will manage network growth (puts) by increasing or decreasing safecoin output to farmers via safecoin lottery but how will we manage the cost of those foods and services to account for the volatility? I honestly don’t see a solution to this. The best way to mitigate risk would be for us to have an easy app or software that converts merchant’s safecoin to fiat automatically.
To trade PUTs directly will cause arbitrage between SAFEcoin and PUTs and become a trading triangle between fiat (or BTC) and safecoin and PUTs. Traffic in these will be huge as people try to trade themselves into a better position. Massive load on the network doing the transfers of safecoin and PUT balances.
Not at that time. The RFC has it that you buy a balance and then the balance is reduced by the PUT price as you do a PUT.
You spend a coin, it gives you a balance of 2^63
You do a PUT the balance is reduced by the then current PUT price.
The effect of this is that you cannot attempt to game the system by
add massive amount of storage
using multiple accounts spend a lot of safecoin buying your balance in each account
remove you huge amounts of storage
have cheap uploads for the next ten years while everyone pays dearly or cheaply.
you might spend a few thousand dollars for a day of VM instances/storage to get the low price but over the next years it pays off immensely.
So by reducing the balance by the PUT price rather than buying a certain amount of PUTs prevents the gaming of PUTs
My view is that we want to keep it as simple as possible without need for additional bits here and there. For the network itself then having safecoin able to be exchanged on exchanges hopefully will be all we need. Division of the coin should help here.