To me, getting 20% for a simple 3.5 day lock is completely unrealistic and it’s getting something for almost free. It’s not realistic and not fair to the chain.
What if the time valut concept itself is not fair to the chain?
I have no doubts the time vaults are going to happen. Giving people a playground is a service.
Utility first, numbers second. From chain's POV, the principal utility of time valuts is allowing HBD to be taken off circulation for a predefined time, lowering the debt ratio. The secondary utility is creating the need for extra transactions (for derivatives built around this). I would say that both are worth paying for.
The competition is the HBD->HIVE conversion mechanism. The main difference is the "permanency" of the removal from circulation. Unlike time vaults, the chain does not directly pay for servicing the debt ratio and collects 5% whenever the removal gets reversed by HIVE->HBD conversion taking place. The primary costs are visibly on HBD holders (if haircut hits). Secondary cost would be a less stable HBD price (so in practice, there is some cost via running the hbdstabilizer).
Clearly, the 20% APR promotion needs to end ASAP. That said, P stands for "possible" not for "executable" (which would be instant). HBD needs enough presence to be a medium of exchange. Once it proves itself in Sucre, the scaling is suprisingly trivial due to its architecture. Then, the speculators looking for the pristine collateral can (and will) jump on it on their own without further incentives.
The time vault pricing can then be approached from the other end. Starting at 0.001 APR when debt ratio is low, going up when the haircut comes closer. Chain would only buy debt when really need and there will always be some on the playground for the sharks and fixed income people alike.
Shockingly, instead of voting the APR rate, we should vote on (or actually have an algorithm to compute) how much HBD should be locked and then auction off the corresponding amount of bonds.
If we want to get hbd liquid we will convert to it from our hive holdings.
I just quote this to see if the truth repeated thousand times can get elsewhere.
If the time vault is used as collateral for a bond backed loan market with no kyc and ability to always settle in 1usd of hive, it will pay for itself 1000x over. I’ll get to the rest (it’s a long message)
Agreed. It only earns its value when collateralised loans come. The risk and high Apr can be earned from that layer two. No need from hive layer one.
Yes, we need to call it a stableish coin.
I agree with all of this in principle. I especially like the auction of bonds first then let the hbd holders lock in if they wish.
Either way ppl need to have a shock, 1 year hold for what? 15% max. Surely ppl won’t agree to 20% guaranteed for a 1 year lock. When looked at from that perspective it makes more sense to most imo.
The question really is how long do we keep this up, as I can only feel comfortable doing it when the bonding and auction system is in place, and it sounds like this is at least a year away.
If resources were allocated to building This, and building was proceeding in ernest, i could maybe understand ppl getting upset, but the longer we keep this up without the bonding system and auction with collaterilisation system not having been worked on, the more trouble we are asking for