Changing supplies, dynamics, potentials and communities

in LeoFinance3 years ago

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A couple of weeks ago, I wrote a post on the decreasing HIVE supply, which is being affected by Smooth's proposals that are using the inflated value of HBD from the Hive Development Fund (HDF) and using it to buy and lock up HIVE back into the fund, effectively lowering the supply. Where the turn started to happen was around the 30th of March

30.3
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3.4
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17.4
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As you can see, over the last 18 days, there has been a 600,000 HIVE decrease in the supply, which means that over that time, it is currently reducing at an average of 33.3K HIVE daily. That is quite an incredible amount, considering that if it was to continue at this rate (unlikely) 12.1 million HIVE would be removed from the supply over the course of a year, which would effectively cut around 50% of the entire year's reward pool out of the supply, or a full 3% out of the entire supply - That is an incredible amount.

What you will also notice is that there is a massive increase in the supple of HBD, where over 1.5 million HBD has flooded into the market place. Once Hardfork25 drops in approximately a couple months, the hope is that the new HBD peg will become far less volatile and will sit between the 1.00 and 1.05. Because of the potential stability and the change that is likely to offer a decent APR on HBD in the savings wallet, the demand for it might skyrocket, as people will be able to buy and earn a ROI similar to curation returns, without having to worry about locking the stake up, as there is only a 3-day unlocking period on the wallets. I suspect that later, this will also be applied to the HIVE savings wallet if this ends up being successful.

This change ultimately affects the entire dynamics of the platform, as it adds a usecase for HBD as an earning mechanism and if it does happen to hold its peg suitably, additional usecases as a stable coin are also introduced, something that wasn't possible due to volatility before. One of these uses would be the ability to trade effectively between HBD and HIVE on platform in the ups and downs, which could effectively keep more HIVE on the platform, just like the stables on exchanges allow people to secure gains in the downward market, without moving into fiat.

Changing the mechanisms of the Hive economy sets up a lot of complexities, where for example there will be people who are willing to buy HBD for a 10-20% yearly return, and others who will buy HIVE POWER for about the same through curation activities and return. The difference of course is that if HBD remains stable, that 10-205 is the total potential, but if HIVE gets market attention, the upside ceiling is an unknown.

  • Assuming one dollar HBD: 1000 HBD @ 20% will attract another 200 HBD for a total of 1200 worth.
  • 1000 dollars worth of HIVE however could attract 200 more HIVE to it, but the value of it is an unknown. If that HIVE was bought at 10 cents, it cost 100 dollars initial investment - if the price moves to 2 dollars, the eventual value is 2400 dollars worth

These kinds of "games" in the platform make for a lot of game theory and it is going to be very interesting to see how people play it. One of the beauties of a complex economy is that there are so many variables in play that it is hard to predict what will be the best course of action, making people uncertain about which path to take. For many, what they are likely to do is diversify across a range of paths, trying to capture value at various points, but potentially missing out on the single "big win" of getting the one path correct.

The changing ecosystem of crypto in general has meant that there are far more possibilities to both win and lose in the system, but those who take a relatively even-keeled approach, are going to likely see more upside than down. Whereas in the past it was about picking the right coin, hodling and hoping it will increase in value in order to sell into something that can retain that value - the diversity of ROI and staking options means that the entire economy of crypto will start to stabilize, as the pathway becomes less clear and there will be distribution of activity.

This is the maturing of the economy, but we are still in a very immature economic toddler phase, as there isn't yet enough participants to bring true stability. Hive itself is changing a lot in regards to this,, as it is not only becoming a more complex economic unit through diversity of value streams and sinks, it is also expanding enduser potential through distribution of experience. The more mature the community as a whole becomes, the more empowered the applications that provide for them become, and the greater the potential for new applications to arrive.

A lot of people don't like this side of Hive, as they see as talking about "money" as a base trait, as if it is all that people focus on. However, each of us is effectively a participant in all economies that effect us, whether we take an active role or note. Some people will not care about these things at all and just go about their business as they have always done, some will spend a huge amount of time and effort trying to maximize their ROI - it doesn't really matter which way people choose, a movement in one area will have affects on the other and the interplay between all movements will create dynamics that will change constantly over time, as we as a community change in behaviors too.

Hardfork25 could potentially be the most important fork in the history of this blockchain, as it could very well bring a decentralized point of stability to the industry for the first time. While everyone is going to have new options available, the potential impact on the entire Hive community through these changes could be enormous.

Again and as always, it is going to be interesting to see how it all plays out.

Taraz
[ Gen1: Hive ]

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I am still of the opinion that any financial/reward system changes should have been saved for HF 26 and that HF 25 should only be about the foundation work. No last minute changes have ever made it through with out causing damage to the HF. The work on HF 25 has been an immense effort on the part of the developers, test of the code and the changes have been on going, and it seemed it would lead to a solid HF with out a lot of glitches.

Anything brought in at last minute is suspect to me personally especially when it is a subject that has been being talked about for years, yet was not talked about at the beginning of HF 25 for inclusion. Waiting another 6 months for the change is not going to break Hive progress, only add to the perspective/perception that Hive is about more than the money.

No last minute changes have ever made it through with out causing damage to the HF.

I think that it will only be included if BT and others think it is possible to include without glitches.

It is going to be an interesting HF overall though, as there are going to be a lot of changes that I think daily users will see, with most benefiting.

He did reply that if they can not get the testing done to satisfaction it will not be included so that is good, health of the chain before maybe it will work.

I am also in the camp of it being a good healthy hard fork, I've been following the code clean-up (of which there was a lot), and some of the other progress. The RC delegation needed more work, so that is why a future soft fork is likely unless the crew is totally satisfied with the testing out phase.

From my understanding, the chain is running pretty efficiently at the moment, so I hope that it is to the point that if there is a high demand, RCs will be able to be brought into play to support growth.

Yes they have been working real hard to keep the time of all the systems working together for no more than a 3 second delay. Keeping that goal has not been a real simple thing for them. Howo was real busy helping keep that goal and for a while the RC work got put on the back burner, this last month he has been working pretty steadily on the RC delegations and feels he is pretty close, testing will verify if it will make it into the fork or a planned soft fork since it does not require witness consensus.

One thing about following all the dev chats is I feel I am actually learning a little bit of the development process.

!EBGAGE 20

The RC Delegation is going to be a pretty big thing for the second layer development making on-boarding and giving the new users a method to post, comment and vote right away everyday, (with-in limits), will hopefully help with user retention. No more only being able to do something every five days while minimal RC recovers.

One thing about following all the dev chats is I feel I am actually learning a little bit of the development process.

I think if I had a little more time, I should get into this too. It is an interesting area I know so little about.

!ENGAGE 20
Fat fingers above.

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EBGAGE 20

!ENGAGE 20

!LUV

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Thank you for catching that typo of mine, much appreciated,
!ENGAGE 20

My fingers at times get fat.

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An interesting observation.

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I hope so
It would be a good idea to freeze Hive to HBD without moving funds to external platforms
If the price of HBD stabilizes at $ 1

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I am hoping that it will work - After four years of it not. :D

Better late than never :D

!LUV

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So, get HBD sell for Hive, put Hive in savings and wait for HBD to crash and then buy back and put into savings.

This mechanism is far more likely to increase the cost of HBD then keep it pegged.

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The printing model changes after the hardfork, so it should hopefully end up pegged eventually, as it balances.

That should be really good and a great way into Hive and earning ROI.

So in the interim sell and use to buy Hive!

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So in the interim sell and use to buy Hive!

Pretty much all HBD has ever been good for.

Interesting dynamics. It is great to see that there is a process underway to improve the HIVE blockchain. After your message, I look forward to 25 hardforks even more.

!LUV



Link to vote for @cranium as a witness

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For the benefit of HBD,the best is always welcome

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