author=fluxer555 link=topic=10583.msg139218#msg139218 date=1414332467]
Firstly, inflation is not "capital infusion". It's a redistribution of wealth. No new money is entering the system, and the market cap does not increase as a result.
The "inflation" is not just given away. It is traded for performance of the devs which adds value to the DAC, which ,yes, should/will result in increase market cap.
Two people agree to form a company.
One has money, the other has time.
They agree that time is worth money.
So they split ownership of the company according to the amount of time or money each contributes.
Over the years, as they each contribute more time or money to the company,
They are issued receipts, denominated in USD, for their contribution.
At any point in time, ownership percentages are determined by the sum of receipts each person holds.
That is what we are doing here.
BitShares are nothing but receipts for contributions made to the company.
So any concept of inflation here is a
non sequitur.
It is a holdover from bitcointhink and does not apply.
BitShares are receipts reflecting ownership originally derived from contributions made to the growth of the company.
bitUSD, bitCNY, et. al, are the currencies. They are the stable units of account pegged to other currencies.
They cannot be inflated (although they will faithfully track any inflation in the currency to which they are pegged.)
Anytime anybody brings a contribution of money, or something worth money, to the company, they should be recognized with receipts (shares) for that contribution. As the company's shares go in value, it takes fewer shares to recognize new contributions than it did to recognize the same contribution made earlier. Thus, early founders profit from growth in value of their shares but new contributors get credit based on relative value at the time they made their contribution.
When delegates get paid with new share reciepts, that is exactly what is happening. They are getting credit for their added contributions.
So, if you are tempted to use the word "inflation" with respect to BitShares, stop. Go back to first principles and be happy.