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RE: Hive Images Proposal to Burn 1000 PHOTO Daily for One Year

in Hive Images2 years ago

Burning tokens is generally a bad idea, imho.

Burning tokens for a startup project is a really bad idea, imho.


... a steady increase in supply is a good thing, as long as that supply is finding its way into new hands -- and that probably holds true until the token becomes the world’s de facto currency.

https://peakd.com/hive-150329/@trostparadox/to-burn-or-not-to-burn-i-say-don-t-burn-crypto-or-bridges-or-witches-maybe-ducks-are-okay

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Fair enough. It's not a large number being burned compared to the max supply (0.0364%). It's also up for vote. It's not pure democracy but I think you'll agree that in cases like this the more tokens (a.k.a. "skin in the game") you have the more seriously you'll consider each proposal. The proposal only passes if enough of the vote weight of PHOTO token holders vote for the proposal.

Even if you don't have a large vote weight in PHOTO your opinions are always welcome. It can help others think about and decide whether or not to vote on a proposal. Thanks for your reply.

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There are plenty of smart folks out there who disagree with me on this.

For me, I have yet to see any convincing evidence that burning tokens leads to an increase in token price.

With that said, if burning tokens leads to less centralized distribution then that’s likely a good thing.

Putting tokens into a liquidity pool instead of burning them seems a better option. Of course you have to be able to provide the other token for the liquidity pool, so that’s not as easy as it sounds.

I wish you the best with this project!

For rewards the token is simply deposited into the pool by the smart contract. It's a reward being provided and not liquidity. In less than a week I'll post another proposal to provide PHOTO as distribution reward to a pool.

I don't necessarily disagree with you. If a token is created with a huge max supply and a large amount of tokens are burned then it's needlessly foolish or simple pumpnomics before a dump.

My own personal belief that tribes burning small amounts of their tokens is a good thing goes back to one of Satoshi Nakamoto's forum postings:

Lost coins only make everyone else’s coins worth slightly more. Think of it as a donation to everyone.

People are a lot more savvy in 2022 than 2011 so losing keys isn't as common. The most practical way to recreate early bitcoin folly is by consciously losing access to some tokens forever.

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