This may sound repetitive and boring for long-time bitcoiners, but highlighting the crucial aspects of the protocol is never to much, specially for those who are in the process of grasping it.
The journey of learning Bitcoin is full of concepts, but "scarcity" must be one of the most important, from which many other aspects are derived. Once we have true immutable scarcity, technology evolves around it, sometimes slow and uncertain, sometimes not optimal, but always anchored to the solid foundation of scarcity.
Crypto projects often try the opposite approach: new shiny technology first to solve a variety of problems, then expectation that value grows with the results, more like a startup bet. VC's go crazy.
The lesson this week comes - like many times in the past - from an once big "crypto" project.
"But IOTA was different!"
Launched in 2015, IOTA attracted great interest in the crypto community reaching #4 in market cap in the 2017 bullrun. It’s beyond the scope of this post to discuss its technology (the new DAG data-structure), the doubtful decisions along the years, or the promised full decentralization with the much awaited "Coordicide" (shutting down the central validator Node, which is, you know, “right around the corner”).
IOTA was different because all token supply was created in the genesis transaction and 100% put available for the ICO. That’s right, no Venture Capital, no institucional money, and FIXED SUPPLY. FOREVER!
Inspite all problems along the way, the project gathered a loyal community, proud of these differences burned in the principles of the protocol. As of 2021, the Foundation’s leader still preached the scarcity narrative:
With no Proof-of-Work, the only thing left is trust.
Last friday the announcement from IOTA Foundation came: Supply will "temporarily" increase.
By 65%.
Without community discussion (much less voting), in a central-bank style, the Foundation decided and communicated. The reasons and goals of this turn of events can be read in the oficial blog post. (Cantillionaire spoiler: of course almost all of the new printed tokens are going to the Foundation itself and to institutional money).
Even in an unlikely few years scenario where IOTA somehow delivers the 'revolutionary' no-coordinator DAG and gets back to the major 'crypto-league', one thing is certain now: the scarcity-pandora's box is open.
And we all know what happens when humans have a printer button at disposal.