The decentralized Hive fund plays a major role in the Hive ecosystem. It is the backbone for the development and funding of the platform. A tool that provides a self-funding mechanism for the chain! Since the creation of the Hive chain its role has increased massively since there is no centralized entity that will keep developing. The community members are the ones making the development and the DHF is providing the funds.
The DHF has close to 23M HBD now. It holds a lot of HIVE as well but those are not available for use. Since the creation of the Hive blockchain in March 2020, the funds under management in the DHF have grown from under 1M HBD to 23M HBD at this moment.
Let’s take a look at the data.
The account that holds the DHF funds is the @hive.fund. Only 1% of the HBD holdings in this account are available for daily payouts and funding. At the moment this budget is around 220k HBD per day. Projects can create proposals for funding and if they are voted out from the community, they will start receiving funds.
There is only one way funds can exit this account and that is for proposal who have been voted from the community to get the funds.
When it comes to funding the DHF, or how funds are added to the DHF there is more than one way.
Funds added to the DHF:
- 10% share of the inflation
- Ninja mined HIVE conversions to HBD
- @hbdstabilizer
- HBD and HIVE transfers to the DHF
- DHF as posts beneficiary
The core source of funding for the DHF is the inflation.
In recent history a few more significant sources for funding were added. The most significant would be the HIVE that was transferred from Steemit Inc and co to the DHF. At the time of the fork in March 2020, there was more than 83M HIVE put in the DHF. In October 2020, this HIVE was put in a slow conversion mode with 0.05% of it being converted to HBD daily, that will continue for multiple years. This is to avoid price shocks. At the moment, we are half way trough these conversions as there is 42M HIVE in the DHF now.
Another significant source of funds are the transfers to the DHF that are made by the @hbdstabilizer.
This account is receiving fundings for the purpose of stabilizing the HBD. It trades HBD or HIVE on the internal market to maintain the peg and then it sends the funds back to the DHF. Depending on the price of the HBD it sends back HBD or HIVE. When HIVE is sent to the DHF it is instantly converted to HBD at the feed price, making these funds available for use. The stabilizer sends and receive funds, but overall, it has been a net positive. It also acts as post beneficiary for the DHF.
Let’s check the charts.
Funds from Inflation
As mentioned, 10% of the inflation goes to the DHF. Here is the chart.
The amount of HBD added in this way is correlated with the HIVE price. 10% in HBD is not the same when HIVE is 2$ or when it is 10 cents.
A total of 6.3M HBD was added in the DHF from the regular inflation. In 2024 alone there is around 0.5M HBD added in from the DHF from inflation.
Funds from the Ninja Mined HIVE Conversions in the DHF
Here is the chart for the HBD added in this way.
This type of funding started at the end of October 2020. This is when the HF happened that enabled this. These conversions are also heavily dependent on the HIVE price.
A total of 20M HBD was added in the DHF from this source. In 2024 this number is at 1.3M.
This type of funds will slow down going forward as the amount of daily HIVE converted to HBD is going down. When the conversions started there was around 44k HIVE daily converted and now we are at 21k HIVE daily converted to HBD from the ninja mine. Meaning half from the start. Another significant factor is the price of HIVE. Nevertheless, these funds are limited, and after few years they will drop significantly.
HBD Added to the DHF from the @hbdstabilizer
Here is the chart for the net HBD added in the DHF from the @hbdstabilizer.
As mentioned, the stabilizer receives HBD from the DHF, for the purpose of stabilizing the HBD peg.
If the HBD price is higher than 1$ then it will sell the HBD on the internal market. If the HBD price is lower than the peg, it will convert the HBD to HIVE and then buy HBD on the internal market.
If the price is at the peg, it will simply return the funds. It sends back funds to the DHF both, in HBD and HIVE. The HIVE that is sent back to the DHF is instantly converted to HBD in the DHF to be available for usage.
The chart above shows the net HBD added in the DHF from the stabilizer. A total of 3.5M HBD is added in this way in the DHF.
We can notice there has been some volatility in the year, with funds going up and down but in the long run they keep on growing.
When there are spikes in the HBD price, it usually marks a period when more HBD is added in the DHF, and when there are drops in the HBD price, the stabilizer is using more funds and is taking funds out of the DHF.
Note that the stabilizer also receives funds from posts payouts as beneficiary and this has been a significant amount lately since a lot of the top stakeholders allocate there votes there.
Cumulative HBD Added to the DHF
If we combine all the above, we get this.
From the chart above we can notice that the conversions from the ninja mined HIVE in the DHF are the main way for adding funds in the DHF.
A total of 20M HBD or 68% of all the funds in the DHF has been added in this way. The regular inflation is in the second spot with 6.3M (21%), and then the stabilizer with 3.5M (11%).
Payouts from the DHF
As mentioned, this is the only way HBD leaves the DHF. Here is the chart.
The chart above excludes the payouts to the @hbdstabilizer.
We can notice a few spikes in the payouts, usually when some project with heavy funding in a short period of time, like the valueplan.
On average in the last period around 4k HBD has been paid daily to DHF workers. The spikes that we can see on the chart are usually when the @valueplan account has proposal. This account manages a multiple activities under its umbrella.
On a yearly basis the total payouts look like this:
| Year | HBD |
|---|---|
| 2019 | 30,880 |
| 2020 | 616,784 |
| 2021 | 888,701 |
| 2022 | 1,775,947 |
| 2023 | 2,737,887 |
| 2024 | 1,769,031 |
Note than 2024 is half way trough.
The funding to projects has reached an ATH in 2023 with 2.7M allocated, but most likely 2024 will be higher. This might seem a lot, but it is still a small number when compared to some other projects that have much larger development and marketing budgets.
HBD Balance in the DHF
Here is the chart.
When we add the funds added and removed form the DHF we get the chart above.
Close to 23M HBD in the DHF now.
We can see the sharp growth in the funds back in 2021 and 2022. This is mostly because of the ninja mine HIVE to HBD conversions in the DHF and the high HIVE prices at the time.
In 2023 this growth has slowed down as HIVE prices have dropped and payouts increased.
When we zoom in 2023-2024 we get this:
A slow growth of the HBD balance in the DHF in 2023 and 2024. In 2023 a total of 3M HBD was added, while in the first half of 2024 just around 400k. We can even say that 2024 was almost neutral for the DHF balance.
Accounts Receiving Funding from the DHF in 2024
A total of 23 accounts received funding from the DHF.
Here is the chart, excluding the stabilizer.
The @valueplan is on the top for the first half of 2024 with 900k HBD, followed by @peak.open and @keychain.
Other known projects in the top as @leofinance, @spkproposal, @vsc.network etc.
From the beginning of the chain, back in March 2020, more than 50 accounts received some form of funding.
Summary for HBD Added and Removed in the DHF by Category in 2024
Here is the chart.
The Ninja mine conversions are on the top with 1.3M, the regular inflation is on the second spot with 540k, and next is the stabilizer with 300k HBD added to the DHF in 2024.
The payouts to DHF workers are at 1.7M and are negative on the chart. A net 400k HBD was added in the DHF in 2024.
All the best
@dalz
What a shame that valuaplan is grabbing so much, with so little outcome.
Why is that?
Appreciate the data and the analysis
Tnx!
That's good to know. Thanks for the info.
Insane to see how much Valueplan gets and that Leo is getting funded aswell x)
I tried to onboard my cat, she wasn't having it.
What is the need for a decentralized Hive fund? This fund really needs to be open to discussion. How much does it contribute to Hive? Is it used correctly?
Its always debatable :)
Thank you for the stats
Is Ninja usually the one behind all the HBD to Hive swap that we do?
No :)
I think I have so much to learn from the Decentralised fund and how it works
No doubt brother, the Hive Fund's growth and role in supporting community projects are impressive. Great to see decentralized funding driving development without a central entity. The detailed breakdown of sources and payouts is enlightening big bro Dalz ! WEED
Wow, valueplan is getting a lot. Do you have research on valueplan? Like how they manage their funding and whatnot? Would be a great read.
They have periodic reports themself
I am really seeing the stats already
There are many proposals in the DHF that do nothing but remain active. It would be better to hold these DHF funds and investigate what has been done so far and the actual contributions made with those funds.
Otherwise, we won't be able to stop the downfall of HIVE and may end up experiencing the same fate as before.
Please conduct this analysis monthly so we can understand where we are heading.
$WINE