All About BTC, LTC, ETH mining as well as other alternative crypto currencies
Deflation is a very serious problem for all cryptocoins because it prevents them from being used as payment mean. For most coins block reward decreases in time and this increases deflation rate. For PPC-derived coins (PrimeCoin etc) the problem is even worse as soon as they offer difficulty-based block reward formula that makes block reward inversly proportional to difficulty (i.e. difficulty goes up and block reward goes down). I consider both practices to be counterproductive. Moneta Verde (MCN) is the first cryptocoin with blockreward increasing together with difficulty. Why this is a good idea?
1. Money supply goes up with difficulty increase. As soon as difficulty increase usually happens due to an increased demand this will lead to money supply being dependent on demand. This way MCN will has a slower deflation rate than other coins.
2. Instamine is now useless because block reward is close to zero on low difficulty blocks. This will give us a better coins distribution.
Block reward formula is a fixed point implementation of log2(difficulty). This means that block reward increases much slower than difficulty: for 1 coin to be added to block reward a difficulty must be increased twice. This rate looks to be reasonable.
– at GitHub