The supply of bitcoin is capped at 21 million. The supply of Ether is similarly capped at ~90 million.
If we are to assume that Ethereum will become more popular as time progresses, and if we also assume – for the sake of argument – that the value of Ether will therefore also rise as demand increases, we might therefore think it likely that people mining in these early days might stockpile any Ether they mine to sell at a later date.
Regardless of whether this is happening (or will happen) or not, is there anything built into how Ethereum works to prevent such stockpiling from occurring?
Best Answer
If you refer to something like Demurrage in Freicoin, then the answer is probably no - there was no special design to discourage hoarding of Ether. Also, the argument that such deterrent is required is related to the argument about wether Ether should be considered money or rather capital stock, or something else.
Additional info on Demurrage: It is understood as an artificial 'tax' on holding a currency, similar to the cost of storing and guarding any commodity. In the world of paper money, demurrage could be implemented as stamps, that had to be purchased and regularly affixed on a note of currency for it to continue to be valid. In the world of cryptocurrencies, demurrage can be implemented, for example, as an automatic reduction of amounts of currency held by accounts. It has been shown that demurrage does indeed increase velocity of money and could stimulate economic activity (in a similar way as inflation, but in more predictable manner).