How did Hive did in 2023 from an inflation standpoint? Lets take a look!
The projected inflation for Hive for 2023 is 6.5% on a yearly basis, or 0.55% on a monthly basis.
Hive has a double currency system, HIVE and HBD, with conversions between them that add or remove HIVE from circulation on top of the regular inflation. Furthermore, the decentralized hive fund DHF, that serves as a DAO converts the HIVE that is in the DHF into HBD.
The @hbdstabilizer has also grown and it is playing an important role in the overall tokenomics, making conversions and trading on the internal market.
Because of this additional mechanics the HIVE inflation and supply can be drastically different in real time than the regular/projected one.
To be able to follow the HIVE supply we need to take a look at all the different ways HIVE is created, author, curation, witness rewards, conversions etc, then net that out with the HIVE burned from conversions, accounts fees, null transfers etc. To get the virtual supply we need to do the same for the HBD supply as well.
HIVE Created
Here is the chart.
The chart above includes:
- Author rewards
- Curation rewards
- Witness rewards
- Staking rewards
These are the regular ways new Hive enters circulation, and all of them are through vested HIVE, aka powered up. You can notice the slight fluctuations in the daily amounts that is connected with the virtual hive supply, or the base for the inflation. When the price of HIVE is low, the virtual hive supply increases, and when it is up, the virtual hive supply decreases.
The thing is the conversions are playing a major role in the ecosystem. Here is the chart again, including conversions.
We can notice that the HBD to HIVE conversions are the dominant in the chart. This works in both ways and a big part of them is converted back to HIVE, especially through the work of the stabilizer.
The regular inflation is around 70k HIVE per day. On the other hand, the conversions averaged around 70k per day as well, although as noted a lot of them are converted back to HBD.
We can notice the drop in recent months. This is because the stabilizer has changed its funding from the DHF and has reduced the daily amount of funds it receives and sends them back to the DHF.
HIVE Removed from Circulation
Here is the chart.
The above takes into consideration six different ways of HIVE removed:
- Ninja Mined HIVE To HBD Conversions In DHF
- HIVE transfers to DHF and converted to HBD
- Transfers to null
- Null as post beneficiary
- New accounts creation fee
- HIVE to HBD conversions
The HIVE transfers to the DHF are now dominant. These are transfers made by the stabilizer. We can see a few spikes in the HIVE to HBD conversions (blue) in 2023. These were due to the increase in the HBD price. We can also notice the drop in recent months, same as the opposite conversions due to the low volumes that the stabilizer is doing.
Historical HIVE Supply
When all the above is added and removed, we get this chart for the all-time HIVE supply.
Up until August 2021, the supply was almost steadily increasing with a small fluctuation. Then a drop in the supply in September 2021. Since then, from time to time we can see some drops in the supply with the recent happening in February and April 2023. December ended with 419M HIVE in circulation.
HBD Supply
Here is the chart for the HBD supply.
The light color is HBD in the DHF. The HBD in the DHF is not freely circulating HBD and only enters circulation when payouts to the DHF workers are made.
HBD is being created and removed in various ways, but the conversions play the major role here in both directions. Other ways HBD is created are DHF proposal payouts, author rewards and interest.
We can see that after a downtrend in 2022, in 2023 there was an increase in the HBD supply in February, a small decrease in March and again a small increase in April.
In the last months the HBD supply has been almost constant hovering around 11M HBD.
Virtual HIVE Supply
When we add the HIVE equivalent supply from the HBD to the HIVE supply we get the chart below.
The light color is HIVE that in theory can be converted from HBD at the current market prices for HIVE.
We can see that the virtual supply fluctuates a lot, mostly because it is tied to the price of HIVE. As the price of HIVE drops, the virtual supply increases and the opposite.
When we zoom in 2022 - 2023 we get this:
In 2022 and 2023 the virtual supply has increased because of the drop in the HIVE price. In the last month we have had a small decrease in the virtual supply to due the uptrend of the HIVE price.
Projected VS Realized HIVE Inflation in 2023
This chart tells the story of the new HIVE entering circulation in 2023.
There was a downtrend from the beginning of the year, up to March, when HIVE was deflationary, but since then the supply kept growing, with some small drops, and we are now almost at the same level as projected and realized.
A cumulative 23.8M HIVE added in 2023, while the projected one is around 24.6M. Almost the same!
Monthly Inflation
If we plot the monthly inflation in 2023, we get this.
2023 has been interesting. January had a small positive inflation, February a negative one, that was offset by the positive inflation in March, April is almost at zero.
In the last months of the year the inflation was just above 0.5% per month just around the projected one.
In terms of absolute numbers, the HIVE supply in December has increased from 416.5M to 418.7M, adding 2.2M HIVE in circulation, same as the projected one for the month.
Yearly Inflation
The yearly, projected and realized inflation looks like this.
Hive is almost as the projected inflation in 2023. A 5.7% yearly inflation, just below the projected 6.5%.
Net HIVE Created by Category in 2023
Here is the new HIVE put in circulation by category for the month.
In a table format the data looks like this:
| Category | HIVE |
|---|---|
| Curation | 10,798,488 |
| Author | 5,706,315 |
| Staking | 5,009,172 |
| Witness | 3,327,319 |
| Transfers to null | -14,111 |
| Accounts creation fee | -19,887 |
| Conversions | -1,066,421 |
The curation rewards are on the top with 10.8M HIVE. Next are authors rewards with 5.7M. A note that authors rewards are paid 50% HIVE, 50% HBD, so additionally to the 5.7M HIVE there is 1.8M HBD to authors as well. Staking rewards are next with 5M, witnesses have received 3.3M HIVE in the year.
On the negative side we have transfers to null and null as beneficiary with 14k HIVE, then around 20k burned for account creation and 1M removed from conversions that include HIVE to HBD, HIVE transfers to DHF and HIVE converted to HBD in the DHF.
All the best
@dalz
From my estimates this number is incorrect. On January 1st of 2023 the print rate was 6.94%. That rate decreases by 0.01% every 250,000 blocks. This means that every year the inflation decreases by 0.42%, so by the end of 2023 it would be 6.52%. However, that emission rate only applies to the end of the year, not to the whole period.
The estimated inflation for 2023 would be the average from the start and the end of the year, which is 6.73%.
Yes that is exactly how it is. I have rounded it up to 6.5% for simplicity. Also when you calculate these things you need the period that have passed to end, to have a base and the addition (new inflation).
Thanks for the great overview Dalz!
You welcome!
Let's see how hive will perform in 2024.
Thank you so much for sharing this
Inflation has been behaving very stable, especially in the last two years, and HBD is not causing any problems, rather it is proving beneficial.
This is my favorite chart!
A lot of people are really making it big and doing well on here
Thank you very much for sharing the information with us
That's probably one of the most interesting overviews of 2023 I have read in the last days.
Well done!
Thanks for the review dalz.
Thinking from the context of making more money, I would prefer to see Hive inflated much more higher.
What is your possible speculation, how do you expect graph to flow in 2024?
Well I hope it goes deflationary :) But that is just a hope, dont know what will happen, cant predict the future.
Why? You would have more tokens but each token would have less value :)
Thanks, a very interesting and nformative post
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I was curious to know how much was burnt too but great that you included it in the last paragraph. Nice one. 👍
Great. 5,7 is much less than most currencies have in real inflation (not the made up official numbers).
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Thanks for the great overview ! Something I'd be interested to see (but I have absolutely no idea how we'd get the data !) is to compare HIVE inflation with the net of cash investment in users buying HIVE and users powering down and cashing out, as a % of market capitalisation.
Thanks, a very interesting and informative post about HIVE inflation!
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I strongly hope this figure will be much more better this year
Thats a pretty decent overview of the hive network thanks for sharing that with us!