4 monthly report! Always liked that number.
The last few weeks have been pure observation, analysis and refactoring of how to run Hive Power Ventures over the coming months while I combine it with my current studies and life projects. Certainly 2024 will be a year with much movement in the space.
This past Christmas season I had the opportunity to see my dear @resiliencia again.
We talked a bit about everything, about our current vision of Hive, Bitcoin, the ETF's just approved, visions and forecasts in the long term and about sustainability of projects we know and ''what would be the perfect model''. (Spoiler: it does not exist).
Ramblings here and there, but one word in particular keeps echoing in my head...
''The Switch''
And no, we're not talking about the latest Nintendo console (sorry for that xd).
Resi mentioned many times this concept referring to the point at which a project ceases to rely on outflows to sustain itself and is purely self-sustaining.
You may have heard it referred to as 'POL' or 'Project Owned Liquidity'. The truth is that they are all words for the same thing, the moment when a project generates its own ''buying pressure''.
And maybe it's something I don't consciously think about, but it's something I'm looking for all the time (and PWR is no exception).
Perhaps these couple of paragraphs may feel like irrelevant verbiage, but I think they are absolutely necessary to understand some of the approaches and changes I have taken for the coming months.
And now, the Actual Report
@empo.voter keeps providing @vventures with a constant flow of curation rewards.
The main curation account (empo.voter) holds a bit more of 10K HIVE tokens powered up in constant powerdown (~750/week for the next 13 weeks).
The holding account @vventures currently holds 5K HIVE Power tokens while it keeps adding to the liquidity pool (more on that later). For reference; the ratio of powering up/LP'ing which I'm taking is set around 80/20.
However, one fact will stand out. and that the amount of Hive Power delegated is at its lowest point since the launch of the project.
Compared to the delegation ATH in the project (October), the current delegations are about 65% less.
This is not something that has happened randomly as in the last few months a great opportunity to delegate Hive has appeared on Hive (@holozing) with very high APR's (+30%!).
Instead of trying to compete by raising APRs for PWR, I have decided to do the opposite and take a different approach.
**I've removed my own delegation (temporarily) to @empo.voter. **
This obviously represents a temporal cut in HIVE income for the project (also future debt), but as I'm seeing from the last couple of weeks numbers, current inflation for PWR has also been reduced from ~300 tokens daily down to ~100.
I have another problem, as I want to sell some of the cashflow I receive from delegations. But on the other hand I don't want to sell PWR.
And this is where everything I explained earlier about the 'switch' and the sustainability of projects comes into play.
Suddenly, the thought of reducing PWR issuance by keeping its inflation artificially low during some of its most inflationary months doesn't seem so bad.
In fact it is noticeable in the graph how the emission has flattened out. God bless microcaps!
PWR - SWAP.HIVE Pool Status
Another priority right now (along with the never-ending accumulation of HIVE Power) is to stabilise again the of PWR near the peg.
This again is not something left to chance. A little over a month ago I wrote a post commenting that I was going to significantly reduce my buybacks on a personal basis (link to the post below).
https://peakd.com/hive-167922/@empoderat/stress-testing-the-pwr-swaphive-pool
I also think that HIVE/PWR ratio at 0.58 hive is not ''tolerable'' for a project that aims to have a token 'soft-pegged' to another. It just speaks bad, although I should say that I was testing the waters and warned about that. Long term-hodlers should be fine.
**But yes, this means I'm going to start buying back PWR a 'bit' more aggresively relatively soon. **
On the other hand, every cloud has a silver lining. @vventures has been accumulating cheap PWRs in the pool and that's always a good thing.
TL:DR;
- Hive Power Ventures is currently growing more conservatively than before, focus on growing more slowly but more sustainably over time.
- Testing for the liquidity Pool ends soon, buying to stabilize the PWR/HIVE ratio to a more reasonable level is pending on the short term (1 to 2 months).
- Everything else looks more than fine (reasonable HIVE levels, POL and HIVE Power also increasing at a decent pace).
- 2 months left until APR for HIVE Power delegations get reduced down to 12% (from 16%).
Have a great weekend!
Posted Using InLeo Alpha
Nice work empo!
I'm chiling in the pool, while I took my delegation out, as I want to have more control on my HP going in the bull
Completely reasonable, delegate again when u feel comfy :)
It has been a pleasure to see you again! 😊
Regarding the project, I think that you have made a good move, I am sure that you will make the switch happen sooner than expected.
In 2 months the inflation will move significantly downwards with the 16% to 12% reduction.
The project is healthy.
Keep pushing, this 2024 will be amazing for us.
Price has taken a hit it seems it should be a 1:1 ratio right?
Yep, or at least should be a bit more closer.
No worries, it will be pushed higher within a few weeks ma, I don't want to see PWR price that low.
For more context:
https://peakd.com/hive-167922/@empoderat/stress-testing-the-pwr-swaphive-pool
This is my first time hearing about this project and it seem to be a good work
Keep it up!
I think that losing some delegations to other projects, might be healthier for PWR in the end. I've started adding liquidity to the SWAP.HIVE:PWR.