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.

The presumed security benefit to an elevated level of hoarding stems from the theory that an owner has a say in validation and could act to prevent the economy from accepting what the owners collectively consider invalid money. However owners are not acting unless they trade units for something, and in this case it is the merchant who enforces consensus rules. The possibility that owners could act in unison does not increase this zero level of control. The theory is therefore invalid.

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, and is therefore invalid.

The theory implies that less trade in the coin will produce greater security. This is the opposite of the case. As shown in Qualitative Security Model, consensus rule enforcement requires ongoing trade. The price of a unit of the coin in another good or money is arbitrary, but rises temporarily if individuals are convinced to engage in the fallacy. The benefit of this increase accrues to existing owners. The theory that price can only rise is a related speculative error explored in Lunar Fallacy. Even a provable perpetual general price rise would not validate this theory, as it relates only to a temporary relative increase caused by financially sub-optimal individual decisions.