This question has been brewing in my head:
Should I change the economics of the LUV token?
Short answer: There will be no changes for now.
Longer answer: There are many moving parts and although there are no changes now, the maybe there will be changes in the future. I'm writing this to give you some info, to be as transparent as possible, and to offer a window to view my thinking and my gut feeling on things.
tldr; at the bottom of this page
Gears, pulleys, and levers
I've always imagined an economy as a machine, like the LUVbot animations. It spits and churns and crawls and runs and climbs. It produces something of value and it poots out crap. And it sometimes slows and sometimes it stops.
The machine runs or sits still on its own, but there are gears and pulleys that we can grease and levers that we can push and pull. And we can bang on it with a 10 pound sledge.
With regard to the LUV token, the things that I see that could be fiddled with follow:
- Emission rate
- Altering how many LUV can be given per day by users using the
!LUVcommand. - Changing the minimum amount of LUV needed to call the bot (currently at 5).
- Altering how many LUV can be given per day by users using the
- Circulating supply
- Releasing an amount of LUV to holders with a "LUV Appreciation Drop" or holding back such an airdrop.
- Minting and issuing a lot or a little LUV to @LUVshares (which would eventually get into people's wallets via the bot).
Deeper dive and numbers
LUV holders currently:
| Quantity | |
|---|---|
| Number of wallets with at least 1 LUV: | 984 |
| Number of wallets with at least 5 LUV and could use the bot: | 555 |
Emission rate
Over the past two weeks or so, an average of 76 LUV tokens have been emitted into the ecosystem by users applying the !LUV command illustrated in the graph below:
The 76 average is fine, but the fact that it is trending with a gradual increase is what seems promising to me. There seems to be interest in LUV and sharing it.
Similarly, below are the number of comments from @LUVshares. Each time a LUV is given, a reply/comment is issued. You can see the trend.
I asked for some feedback on this and got some (thank you those who responded). The consensus was: keep the max at 3/day. There were ideas that got me to thinking:
- increase the minimum needed to call the bot to something higher than 5
- increase the max LUV per day limit up from 3
- have a special time to allow more LUV to be given
Let's look at these.
Number 1 is a real possibility at some point. I want the minimum to be low (because the goal is to share love, not limit those who can do so). But, if things grow too much, too fast...if the machine runs at too high of an RPM...this lever will likely be pulled. Also, until a week or two ago, I was very concerned about Resource Credits bringing the LUVbot to a halt. I dedicated more HP to @LUVshares and changed the bot's reply configuration. Now, things seem fine. Yet, this is something to watch going forward. If RC cannot be replenished, this lever will likely be the one to be pulled.
Number 2, I think, we'll just leave as it is. That's what I heard.
Number 3, This is a neat idea, a promo time period. One user suggested one day of the week, one user suggested February. I don't think I want to change things each week, but the February promo is something to ponder on.
Circulating supply
There are 12,000 LUV tokens in circulation currently. I will add more in the next day or two because, at this rate, @LUVshares and the bot will be empty within a week. Rather than the raw number of LUV in supply, I believe that the rate they are issued is what's important. Specifically, a set, known, predictable rate is what's important. This can be hard-coded (like Bitcoin), or softer with flexibility (like we have here) - see a post on this. Still, I lean toward consistency in an issuance rate.
Again, sample size is very small, but we have some numbers and can learn something.
Balance and nature
Everything has trade-offs. The trick is to keep things in balance...to keep that economic machine humming not too slow, not too fast. Pushing one lever means having to pull back on another. And, mulling this stuff over, I think I have an even better analogy...sailing. I'll save that post for another day.
I'm kind of stubborn. When a goal is set, I'm pretty good about sticking with it. LUV's goal is to spread love around Hive. This is the main reason I've set the 5-LUV minimum to what I think is very low. Looking ahead, I do see it increasing. But...balance. Altering one thing affects another.
There was a (somewhat weird) film called "Koyaanisqatsi" in the 80s. It's a native-American (Hopi) word meaning "life out of balance." The upshot as I took it is that all things are linked and our meddlings can do more harm than good. In economics terms: there's the law of unintended consequences, there are externalities. In simple terms: "If it ain't broke, don't fix it."
My nature, and my hard-wiring, is to not fiddle with things. I think the LUV token is off to a fine, stable start and that it's slowly growing. By its nature of being shared in a network-like fashion, it stands to figure that the token will expand to new users. There's a monkey that lives inside my brain...one of those toy monkeys holding cymbals. When I think about changing the economics of the LUV token, that monkey starts going ape-berzerk, screeching monkey-screams and banging his cymbals. I'm happy to not fiddle with anything now.
However...
A conclusion
Working through this stuff, I realize this:
- The goal of LUV is to spread love. Since the LUVbot is doing the spreading, I do not want the bot to go down to zero LUV.
- However, graphs 1 and 2 show me that LUV is going out at a slowly increasing rate.
- Graph 3 tells me that:
- Changes to the emission rate in graphs 1 or 2 must be made in order to keep graph 3's LUV supply relatively straight.
- If no changes are made, then the LUVshares account will go to zero and the LUVbot will be dead-in-the-water until replenished.
- This brings us back to balances and trade-offs...how to cut back on LUV going out, yet still allow for LUV to go out. Hmm.
The tldr;
- LUV seems to be slowly growing.
- For now, no changes.
- Going forward, I'll likely alter the emission rate. I'll try to do it in the least invasive way.
- That means I'll likely increase the minimum (5) needed to issue the
!LUVcommand.
Check your wallet or trade LUV at: Hive-Engine or TribalDEX or LeoDEX.
Take a look at official LUVshares NFTs at https://nftshowroom.com/crrdlx/gallery (sales help keep LUVshares going).
I'd like to throw out another idea for down the road. I know that you're just getting things warmed up and I don't want to disturb that. But I do want to plant a seed in your head.
I'm wondering how difficult it would be to gamify the distribution of LUV tokens through the bot. Like a weekly leaderboard of users who spread the most LUV to the most people who didn't have any LUV yet. The top 3 distributers get a reward of Hive or LUV.
Of course, the top of the leader board would be filled with people who all sent 21 LUV, since that's the 7-day max. Here's the tricky part. What if we could send LUV back to the bot to reset our daily limit? Maybe it costs 5 LUV to get a reset for sending 3 more LUV.
I think this could do a number of things. If the competition's reward is nice enough, you'll get people interested and doing the work of checking people's HE wallets to find targets for the LUV bot instead of just sending them to friends.
Since the bot's limit is 3 LUV, people in the competition won't want to give the second LUV command to someone who already has some. So if new recipients want to compete, they'll have to hit the market and buy their remaining LUV. If we can raise our daily limit by returning LUV to the bot, many of current LUV holders will want to buy more from the market too. Like if the competition's reward is 5 Hive, I wouldn't mind spending 1-2 Hive to buy a bunch of LUV in order to compete.
Incentivizing LUV returns to the bot would also help with the token generation schedule.
Just something to think about.
On an unrelated note, I believe RC delegation will be implemented at the next hard fork (if it's not implemented already). Hopefully we'll be able to delegate and prevent the bot from running out of juice. If you need a little HP delegated in the meantime, let me know. I don't have a lot, but I can spare a few hundred.
You have a good mind for ideas. Very clever. I'll think on things. And as far as RC, I think it's fine for now. When I changed the reply system that really helped. (It had been putting out two replies...one to the receiver and one to the giver.) Now it only does one so that cut replies/comments in half. Thanks for the offer of delegation. :)
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