Safecoin from a perspective of monetary velocity

Another thread got me thinking about monetary velocity.

From Wikipedia:

“The velocity of money (also called the velocity of circulation of money) refers to how fast money passes from one holder to the next. It can refer to the income velocity of money, which is the frequency at which the average unit of currency is used to purchase newly domestically-produced goods and services within a given time period.[3] In other words, it is the number of times one dollar is spent to buy goods and services per unit of time.[3] Alternatively and less frequently, it can refer to the transactions velocity of money, which is the frequency with which the average unit of currency is used in any kind of transaction in which it changes possession—not only the purchase of newly produced goods, but also the purchase of financial assets and other items.”

I don’t know much about this, but it seems to me that the network scheme encourages a pretty high velocity of safecoin. It won’t be too hard to get some and there will be a lot of opportunity to spend it.

I think that, while it should definitely increase in value with time, its coupling to network resources will have a moderating effect on volatility. Therefore few will be hoarding it–except for crowdsale people in it for the long haul, maybe. But those amounts held by crowdsale participants are not going to have a choking effect because the safecoin ecosystem is, by definition, dynamic.

And this plays back to one of my favorite hobby horses: broad and continual granular creating of small amounts of safecoin to individuals all over the world.

That’s just some thoughts I had. I’d be really interested to get input on this angle from others who have more knowledge/experience with currency dynamics.


I haven’t got my head around these concepts - Martin Armstrong has talked about the velocity of money in the past. Shown some correlations with other metrics, but I don’t recall the significance. He hasn’t said anything about it for a few months.


I guess the velocity of Safecoin would be high if it were only ever bought in order to use network resources, and then recycled through farmers, and sold to the next customer of network resources.

But if Safecoin has utility far beyond this due to its various benefits as a cryptocurrency, the dynamics could be very different depending on uses.

Apparently the velocity of money is calculated by GDP / the Money Supply, so I guess it’ll be tough to calculate the velocity of Safecoin unless we can somehow calculate the GDP of the ‘Safe economy’ and the total supply of Safecoin. I seem to remember that we won’t be able to know the supply of Safecoin on the network?

The link between Safecoin & the underlying network resources + Safecoin’s uses as crypto-currency + how the network adjusts farming rewards based on supply & demand for storage = I have no idea how this asset will behave! It’ll definitely be interesting.

My guess is that there will be a kind of ‘ratchet’ on the value of Safecoin - easy to go up, hard to drop. If Safecoin’s price rises due to speculation, or uses beyond network resources, there’ll be a gap between price & underlying resources. This will provide an incentive for farmers to provide more resources to fill the gap. Once the gap is filled, the network is more valuable, and the price shouldn’t go far below the increased underlying value of resources.

Similar incentives have led to Bitcoin’s crazily fast hashrate growth, but hashing capacity doesn’t have much use if the value of Bitcoin drops significantly, nor does the quantity of hashing necessarily give Bitcoin value.


Excellent post! I think I now understand what the velocity of money is all about. Thank you so much.

I guess we can say with some degree of certainty that the velocity is likely to slow down over time (although that may only be a very small difference). People are not likely to use safecoin immediately for things outside of safenetwork resources, but it is very likely that there will be an increase in the amount it is used externally if the currency becomes more widely accepted/recognised/valued over time.

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correct me if I am wrong, so the more safe coin is on the network the cheaper storage is but the more expensive safe coin should be because it not being traded on exchanges because of lower supply. The opposite comes in effect when safe network get’s mass adoption and farmer are being awarded because of usage the less safe coin on the network and storage increases in price, but safe coin may decrease in price because it is traded more on the exchanges of more supply.

So when new apps come to safe network like a safe-tube as a trader would be the time to purchase and hoard safe coins because there would be more PUTS on the network and effect would increase the velocity of safe coin on the network but slow the safe coin being put on the exchanges.

I wonder when such things like game of thrones new season is uploaded to the safe network and millions of GETS are being downloaded would increase the farming awards until it is cached into memory how this would effect the velocity of safe coin.

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