Hoarding Fallacy

There is a theory that an increased level of hoarding produces an increased level of security in a coin. This is the similar to the Dumping Fallacy but is not necessarily based on a split.

An increase can only be described relative to some base level. If a person can be convinced that there is increased system security in a higher collective hoarding level, the theory holds that the person may decide to hoard more than would otherwise be optimal (i.e. the person's base level). This amounts to an actual individual cost with a presumed socialized benefit. In other words the theory depends on irrational economic behavior, even if the security benefit is actual.