Understanding DHF
I am hoping by now most of you at least heard about DHF, Decentralized Hive Fund. If not, that is okay too. Read on. If you have heard about it, read on as well, especially if you are a splinterlands player, because you should try and understand the topic.
Generated with AI ∙ September 6, 2024 at 12:21 PM
The Decentralized Hive Fund (DHF) is a proposal-based DPoS financing alternative. The DHF places the consensus behind direct financing of development and other ecosystem-positive projects into the hands of the stakeholders. The distribution of the DHF is decentralized by design. Support for a proposal is calculated based on the total stake in support of that proposal. When a user opts to support a number of proposals, their stake influences the proposals equally. Support for a proposal may be granted or removed but the mechanism cannot be used to negate the sum of supporting stake with a negative vote. This prevents one single large stakeholder from doubling the impact of their stake and influencing the remuneration of numerous proposals, creating a level playing field.
Proposal funding is released when the total value of that supporting stake surpasses the stake behind a benchmark proposal. The benchmark proposal itself may vertically traverse the rankings as per the amount of its supporting stake. The payments are distributed on a hourly schedule over a set period of time as specified upon launch of each proposal. Proposals that surpass the benchmark proposal and unlock funding will receive the funding as remaining in the total ask of the proposal minus the time that had passed prior to funding. The total amount is only released where the proposal unlocks the funds prior to its scheduled duration.
That is the official version of the definition and creation of DHF. The reason I like to discuss this today is because currently we are kindly supported by a DHF proposal. I like for the splinterlands community to understand more details of the inner working and visualization tools that are publicly available.
The DHF was a concept proposed by blocktrades to allow Hive users to publicly propose work they are willing to do in exchange for pay. Hive users can then vote on these proposals in almost the same way they vote for witnesses. It uses stake-weighted votes, but voters can vote for as many proposals as they want.
Where to view Proposals
There are multiple places. It depends on the front end of your choice. I am aware of 3, but there are more:
- peakd.com/proposals - Hive Proposals UI by @peakd
- ecency.com/proposals - Hive Proposals UI by @ecency
- wallet.hive.blog/proposals - the native location
It addition to these, I sometimes directly go to:
(Built with passion by the Peak Open Projects Team)https://hivehub.dev/proposals
This is much more than a proposal viewer and I really like it.
How many are they?
As I count, currently there are 16 DHF proposals that are funded. There are 6 that are not funded or upcoming (I excluded the bottom 2 as joke/early test). Again, to get funding a proposal must be above return proposal at all times during the history of its funding period.
Who voted them?
Yes, this is good to know, and shows many interesting details and parameters. I particularly like this pie charts at https://hivehub.dev/proposals
It allows you to have a quick look on who voted on it and how the votes are distributed as per stakes. Let us compare this Splinterlands Proposal display with a proposal which receives a lot many votes, say the core development proposal by howo
It is quite obvious that blocktrade votes for core development proposal which helps running the blockchain, as he should as the core developer and largest active investor of hive blockchain himself. Currently the top 9 proposals are supported by blocktrades, while the 7 below that (total count is 16 funded) are not supported by blocktrades. I mean, I am sure they are supported, just not voted :) It is much easier to get a proposal funded if it is voted by the largest active stakeholder.
What happens after the proposal is funded
I mean other that they start receiving HBD I mean :)
DHF funding is dynamic. A proposal can lose support at any time. Typically by two ways
- A stakeholder can remove vote from a proposal
- A stakeholder can vote on the return proposal high enough that it displaces a funded proposal
There is also a third natural thing that happens continuously. All hive stakeholders HP grows organically, and also by curation and author rewards. Proposals slowly grows in vote values based on people who voted on the same proposal, as their HP grows slowly.
So with all else being equal, both a funded proposal and the return proposal grows organically in vote value as the stakeholders HP grows. If the stakeholders who voted on return proposal grows their HP at a faster rate than the stakeholders who voted on a funded proposal, then, all else being equal, a funded proposal can get de-funded. This is a natural phenomenon, and is a good thing in my opinion. He helps the project to continueously work and update with the community to lobby for their cause. We always seek to earn the support from the stakeholders who haven't supported us so far. That should be the motto of the DHF.
Good explainer
Many thanks! A rare comment from you! Means a lot.
Hope you are doing well :)
Obviously the big accounts can control who gets funded, but it may be the fairest way to do it. Stake is power on Hive. People do notice when they lose funding as I've had DMs when I change my votes. I vote on stuff I see value in.
The big accounts control it to a degree, and they obviously have a lot of influence. As you say (and I agree) this may be the fairest way. But there is a lot of influence cumulatively in the smaller accounts too. If you look at the SPL proposal, the largest vote group by far is "others" and in the core proposal "others" is the second largest. SPL would definitely not be funded without a lot of smaller accounts building up that "others" slice.
Stake is power at DPOS system. It is our stake which grants us access to the boardroom
The DHF system is interesting in the sense that support needs to be had throughout. In a way, I like that better as it keeps those who are receiving funds accountable but the downside is that it adds too much uncertainty for projects.
Yes all of that is true, will talk more about it soon enough. Uncertainty is only visible for projects which are new in the DHF system. Also the length matters.
Nothing prevents making a one-day (or, technically, one hour) proposal that pays out the entire budget up front, apart from whether stakeholders would approve it.
I'm really liking these tutorial posts of yours lately. I knew some of the things in them, but I always find myself learning more. I didn't know that Blocktrades had that big of a vote, and it is interesting to see how the big voters look like. I guess we have a lot to thank theycallmedan for getting our proposal over the return proposal.
I am writing these post because we are trying to get new people into writing blogs and also trying to get bloggers into gaming:)
I have seen some people in the SPL discord share their posts in Hive. So I think it is working bit by bit.
who are they, please give me a list of their names
I haven't really been keeping track, but these are the ones I saw recently. These are their Hive usernames:
Shadecroat
shadowch4aser
femisapiens
I know them all peripherally
shadowch4aser hive profile does not exist, check the name please
oh without the a, sorry:
shadowch4ser
Great overview and information about how it all works. I hope this gets at least a few more people involved and understanding. I almost wish they had to vote on one witness and one DHF proposal in order to earn the 3% staking rewards like a lot of other blockchains do. While it might not be a much thought of vote at least it's getting people a little more involved.
I think most 'active' hiver are aware of DHF. However I am always skeptical how seriously they take it.
I'm not sure. In the Alliance server I am always shocked by just how many people have no idea what the DHF is or that they can vote on it. Maybe these are mainly new users, I'm not sure (I haven't checked) but I think there is a lot of ignorance about these things. So posts like this are always useful!
Well that is why I wrote this. Especially people think once a project is funded, that's done, but it is not. A project can lose funding anytime.
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Thinking out loud here. Might not have all details correct.
Hive is inflationary, emissions happen continuously, thus increasing the supply.
The DHF is funded by Hive inflation, it is using Hive to create HBD, turning Hive inflation into HBD, this HBD is paid to support projects.
As long as the HBD payed out is not converted back into Hive at some point, then DHF pay-outs serve to reduce an element of Hive inflation.
How are projects realising the value from their HBD ?, they obviously have real world bills to pay with fiat, so do the swap on HE into , say swap.LTC or swap.BTC and then out into Fiat, or can they exchange HBD via any other route.
So to the extent that not all the HBD payed out by the DHF will not immediately turn into Hive, is it fair to say the the DHF system buffers Hive inflation somewhat ?
Yes. Projects sell HBD for fiat or whatever needed to pay the bills. Yes, it adds to inflation.
🎉 Upvoted 🎉
👏 Keep Up the good work on Hive ♦️ 👏
sagarkothari88 to upvote your post ❤️
Thank you for educating those of us who didn't know on this
So time to improve the quality eh? :)
I have not enough stake of hive power to make a big change, but I will participate in the process
Peace #freecompliments
Slow it down and you will see improvements. Never post more than 1/days. Few can do it without dropping quality
Thank you so much
Thanks for explaining it in some better detail, I threw my support for Splinterlands just to help the game and team so happy to learn more about how the whole hive ecosystem works.