Bitcoin’s hard cap and Monero’s tail emission ‘are identical’ in macro-economic view

The advent of Bitcoin led to the inception of several other cryptocurrencies in the market, with each coin promising to solve a different ‘problem’, and presenting its own monetary model. There are some crypto-projects that decided to have a hard cap on its supply, and there are also other coins that decided not to have on based on its underlying use case.

While Bitcoin has a hard cap of 21 million, Monero will see a gradual drop in block rewards until 18.4 million XMR are mined. While a hard cap on the supply is linked to the scarcity of a product, there have been claims that it would put the security of the network at risk, considering that miners would leave the chain for a different one with better rewards. In order to tackle this problem, the community introduced tail emissions, with which miners will be rewarded 0.6 XMR/ block, which will commence at the end of May 2022.

On tail emissions, Monero Outreach blog post stated,

“Tail emission will provide for continued and indefinite mining incentive. Additionally, and perhaps more importantly, tail emission gives Monero a built-in, stable, and predictable inflation – considered essential for real, sound money.”

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