Burned Hive Power (BHP), nah, sounds like you are destroying Hive Power. (PHP) Permanent Hive Power? Is this idea what is needed to incentivize burning? So many questions. Is it possible to develop? What are the risk factors? Would other tokens besides PHP be better to incentivize burning? Is burning tokens wasted value? What incentives could provide value exchanged for burning Hive?
Check out my thoughts on burning tokens, and how this plays out on the Hive social media blockchain.
Permanent HIVE POWER is bound to create imbalances in the system. As I understand the original design of HIVE left a huge block of HIVE in the hands of SteemIt Inc with the idea that this money would be used to fund projects through delegations. When Justin Sun acquired SteemIt Inc, he revoked the delegations.
Having a big block of permanent HIVE POWER locked in a @community321 account provides a reward for the next person who wants to pull a Justin Sun on the community.
Permanent HIVE POWER in individual accounts wouldn't work. It simply creates an incentive for people to sell their account. Even worse, it incentivizes people to borrow against their accounts.
BTW: I think the downvote actually works a bit like burning HIVE POWER. It removes the rewards from a post.
Thanks for the reply.
I definitely agree, you would not want a single account holding PHP. So, the intention I was speaking of was definitely in the sense of individual's holding it.
The incentive to sell accounts that hold PHP may be a bad thing. That was one of the things I had thought about, but I hadn't really explored the +/- and if there would be a way around that.
When thinking about PHP, there are a few different ways to implement it. One way is to create a burn address for each account, and the liquid Hive would be sent to that address with no spending output, hence burning it. This doesn't require sending to a central burn address like @null, but I'm unsure if current or new accounts could be set up to add a new burn address to a current private key. But, you would probably need this, because you wouldn't need an additional token to represent PHP, nor would you want that additional token sent to an address with spending outputs, or it would render PHP no different than HP because you may not be able to power it down, but you could sell/trade it. So, I believe the best option would be the actual Hive in he burned address per account.
So, if you decide you want to sell you Hive account and you have incentive because it has a large amount of PHP, that may not be a good thing. Now, technically today you could still sell an account full of HBD, Hive, and HP. It could be as valuable as a whale account, or a zero balance, or minnow account. Nothing stops you today, so would an account with PHP really be any different than selling a loaded account today, other than the fact that it is loaded with PHP that is permanent and cannot be liquidated? Not that I see.
But, you are correct, it could create incentive. It would be a safer sale than selling an account with liquid Hive and liquid HBD, in the sense that you could sell the account, take the payment, then immediately sending the Hive/HBD from that account, screwing over the buyer.
One possible way to do it though that could work is, if you change your master password/keys, it would destroy the PHP burn address and create a new one. The first thing someone does when receiving a purchased account is change the password so that the previous owner can no longer access that. I wonder if that would be a possible solution? That way if you were to sell the account to a new user, they would not receive he PHP address associated with the account? If you could not transfer the account to a new user, you wouldn't have any incentive to borrow against the account?
Just a thought. Thanks for your input.
I think the rewards go back to the reward pool. Downvotes affect reward distribution. It doesn't burn any rewards.
Correct. He said "like" burning. But you aren't destroying it. It will only be re-distributed to another user from the pool.
The initial discussion was about "burning Hive Power" with the idea of transferring HP to a @null account or some sort of @community321 account where it is off limits.
Putting it in a permanent state on one's account is not the same thing as burning.
HP is just a synonym for VEST. Permanent HP would be VESTING SHARES that cannot be turned into HIVE.
I do not see this as a bad thing.
I just wanted to bring up the fact that permanent VESTS segways into a discussion about selling accounts.
Personally, I do not see a problem with selling developed accounts. For that matter, developing a market for established accounts might actually increase the price of HIVE. A market for trading accounts would attract those users who see HIVE as an investment. These are the users that we need to increase the price of HIVE.
To make my next point, I want to give a wild prediction: I predict that, in 99 years, 99% percent of the people who are currently using HIVE will no longer be using HIVE. Since man is mortal, most HIVE accounts are finite in duration. Accepting human nature, we should have an end game for accounts. The best end game is that people should be able to transfer ownership of their account.
The value of permanent HIVE isn't that it traps people into their account. Permanent HP would turn accounts into equities that people must liquidate as a whole.
Permanent VESTS creates a situation where completely liquidating an account is no longer possible. That means the primary mechanism for leaving the platform would be to sell account.
Personally, I see nothing wrong with this. I think it might be beneficial.
What's the problem if someone wants to sell their account? People can sell all their Hive now.
I agree that people should be able to sell their HIVE accounts. My HIVE account is still my intellectual property. I should be able to sell it if I wanted.
I wrote my post in a way to try to bring up this point.
The current design of HIVE treats posts as if they have no value after the first seven days. A better design is to create a system where each account builds value as people develop their account with the expectation that people might chose to sell the accounts that they develop.
Yes I see no problem there.
Also, why do you believe it would incentivize a user to sell an account that holds permanent value?
My original thought was that it would more likely incentivize one to keep the account, and use it more, because you have a permanent stake. I do think if there were a way to destroy the burn address so that if an account were sold, that it would not provide incentive to sell the account, but to double down on retaining and using it because the only way to get the value back out of it is by use since you cannot liquidate. Because even current Hive Power can be powered down and liquidated.
If I didn't have that option to liquidate, I feel like it would incentivize me to work through the problems on Hive and really try to add value to the space so that I can continue reaping the rewards of PHP.
I was thinking about people who decided to leave HIVE.
When people leave right now, they power down their account. This take at least 13 weeks.
If someone had a substantial amount of Permanent HIVE POWER. They would look to find a way to sell their account.
BTW: I decided to start a thread asking people their opinion about being able to sell accounts
I saw that and replied as well.
Thank you, I realized that this thread was distracting from your ideas on Permanent Hive Power.
paging @mattclarke
Thanks :)
Interesting stuff. Thanks for thinking outside the box.
Regarding regular burning, I think it's a nonsensical idea. Why create them in the first place if you are going to burn them? Do we see anyone burning their fiat notes? Would you do that? I know I wouldn't.
I'm a fan of the idea of a variable powerdown, with Hive Power that is locked longer (subject to a longer powerdown period) gaining access to greater rewards. So greater curation reward, and greater interest via newly created Hive. Permanently locking up Hive such as in the case of your PHP could be another step in the reward incentive.
My thought exactly. Why not lower the overall cap instead? You could even change them to be burned before distributed by allocating a % to @null, right?
True, even if not permanent, having a longer power down with greater rewards is an excellent idea to test I believe. The longer your commitment, the more stable the ecosystem, and that should merit greater rewards.
Thanks for the feedback!
I really like the way you think. When I first arrived the 104 week powerdown was a big drawcard for me, personally.
It reminds me of a discussion that only just got started a week before the sale was announced.
Steemitblog suggested variable lock-in periods, potentially with no maximum; with longer periods getting a larger share of the inflation. It was also suggested, in the comments, that things like vote weight and resource credits could/should scale, too.
I recall thinking I'd be open to a 20 year option (if the incentives were there).
(It'd still arrive sooner than my superannuation)
I'd like to think we could even do both variable staking periods and PHP.
Maybe PHP could deliver downvote weight at 10x the rate of HP; then those showing permanent commitment to the platform can throw some real weight around when policing it.
Yeah there are so many potential options you could potentially program into this system.
When it comes to staking HP, and the discussion on length of powerdown, etc., I think many people forget or do not know that Steem's original powerdown was a 104 week cycle, and was changed to 13 weeks.
Some still long for that shorter power down cycle, specially in an age of competing with DPoS tokens that let you un-stake instantly, or in less than 3 days. But, I believe there is potential gains and predictability in the effects of a longer power down cycle, or even something like PHP where stake is permanent.
Overall, even if it isn't PHP, I also do still swing back to the theory that if you have a reason to burn tokens and destroy the value, why not find options to transfer the value in a better way than existing tokens price appreciation. PHP seems like an interesting way to destroy a Hive token's value for the potential long term benefits if you truly believe Hive is the future of social media blockchains.
I'm not saying I'd burn all my Hive for PHP, or even keep a higher stake % in PHP over HP, but i would definitely have a large % stake risked since I believe that Hive is going to do big things and if the incentives of PHP reflected the value of that risk of a permanent commitment.
Thanks for the feedback! Followed.
Here is my idea. Hive-Engine tokens are like double-vesting because there are extra steps to get your tokens out. I have launched a new token called PLUS and that is what I am doing. I am onboarding users to Hive with the new website (under construction) and encouraging them to acquire a certain balance of PLUS tokens.
It is functionally going to act like a permanent staking. I don't know if it would interest many investors. But I like the fact that you are trying to add value to the ecosystem.
As far as if investors would show interest, I think it depends on incentives.
If you make a list of all the incentives to hold regular HP, you’d have to have much higher incentives than that to get users to risk burning liquid Hive for the greater rewards.
But, as whales and other users who have more assets to risk begin to do so, it would create pressure for almost everyone on Hive to allocate a % of their Hive to PHP in order to stay competitive in curation rewards, bandwidth, and other incentives HP gives you.
I would think there would have to be a threshold at which PHP users are reaping from the rewards pool at a higher rate than regular HP, that it would give incentive to allocate some of your Hive to PHP.
The reward from that is the overall total liquid Hive is reduced creating more value for existing liquid Hive, and you gain the ability to gain additional rewards from the risk of committing to a permanent stake.
The downside is a permanent stake could go to zero if Hive fails long term. But a permanent stake should create more incentive than HP which can be powered down, and users cut and run.
I have a feeling you would probably never see the overall % of PHP be higher than HP. People want the safety net to cut and run. But it would be interesting to see if and a how an addition of PHP would act in real life.
It will be an interesting experiment. You will have a very hard time convincing developers to implement the features. Tings like SMTs could bring a lot more into the ecosystem and a large part of the SMT development was already complete.
That could be true. But there seems to be incentive to burn Hive, and for PeakD to implement functions such as adding @null as a beneficiary, or burning Hive as part of promoting a post.
The problem I see is the incentive for the user to part with the value of the Hive token being burned. I think Hive could transfer that value, rather than destroy the value. It’s a win-win.
Also, PHP permanent staking is just one example. I’m sure with SMTs and Hive Engine tokens, other ideas of value transfer could be implemented: when you burn Hive you receive this token. Still seems to be a better value proposition than simply destroying value to increase value of remaining tokens.
Thanks for the feedback and likes!
Exactly. It's Hive being powered up, but permanently. Permanent staking.
Although, @yintercept did bring up a good point, it’s only as permanent as selling your account unless you program it in a way that you cannot do so.
If we reset the master password to the account, I believe that changes all of the public key/private key pairs of your other keys such as posting, active, owner, memo.
So, I wonder if it can be created in a way where you also have a burn key? If you reset the master password, it would destroy the public/private key pair of the burn key.
People sometimes change their passwords for security reasons.
For example, I changed the passwords for both my HIVE and SteemIt account after the Justin Sun fiasco.
I change my passwords anytime I feel that my password vault may have been compromised.
I would see any system that destroyed money in my account for engaging in routine security to be problematic.
BTW, if I sold my account; I would do so by simply giving the buyer the master keys along with the promise that I would never use the account again. When Ned sold out to Justin he did so simply by handing Justin the keys to the kingdom.
That is a flaw. If you had to change the PoW for security reasons, it would destroy access to the PHP. Hmmm. So that would probably not be a way to implement it.
I’m pretty sure though that anyone who receives a purchased account would change the master password. If you are storing value in the account, you’re not going to just trust they’ll never use it again. The only secure way would be changing the master pw.
That would be problematic if you destroyed the value simply by changing for security reasons.
Is there any more incentive to sell an account with permanent staking vs selling an account today loaded with HP or liquid Hive?
Quite frankly, I think that the ability to sell accounts is a good thing.
While individuals would prefer to power down and sell their accounts. Businesses are prone to think of their social media accounts as assets that they buy and sell as assets.
So, lets think about the entrepreneur Bob who likes to provide examples. He owns the company Example Inc which provides examples on domains like example.com, example.org, etc. Bob decides to hawk examples on Hive with the account @example .
When Bob decides to retire, he is likely to sell Example with all of its assets including example.com and the Hive account @example.
Okay, so maybe example.com is not a good example.
The basic point is that businesses tend to develop their social media accounts as assets. Business leaders buy and sell assets on a regular basis. This is what businesses do.
It seems to me that the HIVE community should encourage businesses to think of their account as an asset that they could buy and sell.
Quite frankly, I think that businesses would be more likely to buy HIVE and start using it as a currency than individuals.
I think that the incentive on PHP does NOT have to be greater than normal hive. Here's why:
PHP would still have the same value as burning, but now the added value of Resource credits, etc.
But it's a good idea.
It seems that burning doesn't affect the market like stock buybacks