i mean in a bear the inflation will skyrocket.
So the short-term data and deflationary scenarios are only proven if we stay deflationary in a bear.
And I would expect as the longer the bull goes, the more inflation we become because of HBD.
If swings are fast and extreme, inflation can become also extreme.
So only time will tell. I mean cheap hive is a very good thing for growing as long onboarding is not fixed.
0,1$ hive is the only price I would expect dapps to pay to onboard people for wallet creation.
Burn and increase price again.
I would not expect Splinterlands and friends run a multi million marketing campaign to pay twice, or even more for wallet creation.
In the past there was no hive to hbd conversions so hbd/sbd goes up. Now we have this and hbd stays at 1$.... hive supply goes down. From the past we can see that 2019 regular inflation was 8%, with conversions 12% ... so yes more but not so dramatic..... at this moment hbd is in very low supply compared to hive marketcap and we have only 2% debt.... that is rediculusly low .... the hbd supply can expand a lot from here without major concerns ....
all theory. In general, I agree.
But a swing to 10$, stay some weeks on avg there into bear could end up in major damage.
multiplier under 1$ increase exponential on conversions + conversions = higher MC after = more inflation out of that higher MC for max HBD supply.
So in game theory on max abuse, we have an exponential curve on hive inflation on conversations as the more volatile the market becomes.
I would love to see how luna performs in bear before we see massive increases.
wave algo stable coin losses today 20% for example. MC 1B.
so 200M loss in value. can start panic.
HBD was at 0.6 in the past...the world didnt end....At this point I'm in dilema is a hard peg a good or a bad thing. I mean projects go around such a big hurdle to keep the peg. Maybe it is better to have a loose peg like HBD. Just let everyone knows this upfront and manage their risk this ... if HIVE drops a lot ... then sorry ...haircut... HBD is no longer 1$ .... oh but its not a stablecoin.... well it is like 95% of the time, manage that week, month .... dunno just thinking out loud here
true. but on a big scale, it could be a problem.
and if haircut increase to 30% it can be a problem for the chain.
No risk no gain :)
10% is very conservative, 30% still is, 50% is medium risk
depending on the math.
If we calculate swings in ( remember we have no liquidations), it can end up in a drama inflation for hive.
That would end up in a drama token price. And this end up in " fuck you hive power holder".
I mean first should be a semi-protection of Hive power holder.
If hive inflate on a max abuse curve from 7$ to 0,2$ would mean 200% inflation.
I think you are not calculating in that HBD will not be worth it 1$ if the price of HIVE drops, meaning lot less HIVE can be created from HBD even at lower prices .... 200% is impossible