We already have staking. That's what Hive Power is. Are you suggesting another way to stake that provides some other benefit than increased influence (bigger votes) on the platform?
Hmmmm.....
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We already have staking. That's what Hive Power is. Are you suggesting another way to stake that provides some other benefit than increased influence (bigger votes) on the platform?
Hmmmm.....
We also have savings, but nobody uses it because the interest rate is usually zero.
Perhaps this is where we can better integrate the Hive DeFi vision of @rycharde to goose those yields and incentivize more people to save!
Thanks for the tags (both @shanghaipreneur and @eturnerx), but as you both also know my dislike of pointless burning as the only mechanism to deflate a highly inflated token - see scot tribes for recent experiential consequences.
Having said that, let's see if it would work on a macro level. The reward pool actually does a decent job at reacting to activity - the only economic activity being the generation of rshares and hence rewards - but what it doesn't do is react to liquidity, or more accurately, the money supply.
We have seen the consequences on Steem of pumping coins into an economy that has an oversupply. So what is need is a feedback loop that can change the minting rate to reflect the coin supply.
In the absence of such a feedback mechanism, burning coins could be used as a mechanism. We can define the coin supply as the ratio of HP over total HIVE.
If this ratio is high, most coins are vested and the burn rate can be low; if the ratio is low, it means most coins are unvested and liquid (and hence cannot participate in the economy) and so the burn rate increases.
We can look at historical values to gauge appropriate numbers and calculate the feedback effect on the reward pool!
On the specific point of fintech programs, the interest generated by the blockchain is far higher than the minting rate; how is it possible for dlease to offer 15% APR on an 8% blockchain? This is a legacy of the Steem economy that Hive has inherited. This can be changed but it first requires a deep and widespread understanding of how the chain actually works.
OH, that's nice! So using staking rate (HP/HIVE) to dynamically control inflation rate (using burns to reduce programmed inflation). This is exactly the mechanism used on Tendermint chains, so that's kind of nice.
My only problem with this is it doesn't directly create buying pressure, so it's not as robust in terms of being directly tied to economic activity as "selling ads to get money to buy tokens to burn." But on the flip side, it sounds like something that could be programmed, rather than managed, which in general is better for decentralization. Managed things tend to get corrupted eventually.
Ah, you see: ideas are free! (sadly) Didn't know Tendermint chains did that.
That doesn't mean there cannot be two different burning mechanisms.
Some time ago. I investigated whether any real economies burnt their money - apart from online games that hold a tenuous link to reality, and to economics - and discovered the Penn Scrip. This is pre-hegemonic-US-dollar and, astonishingly, didn't collapse - was swallowed up anyway. What they did was burn taxes ie activity - they also only lent money to productive industries, hence not to banks. So, again, this was a money supply measure with a consequent price stability and an allowed inflation rate so long as it was matched by productivity. in the broad sense of productive activity.
The selling ads to burn tokens is narrow and would also rely on human intervention, unless the ads were internal - even then, what mechanism would price the ads? a bidding system? Who would use this? I'd have to think it through, though strikes me as a micro-economic measure rather than macro.
External ads would be more useful but would need some programmatic way to ensure that income is used as intended.
I think before a Hive Improvement Proposal, we need a Hive Improvement Team! A HIT anyone?!
I was thinking that maybe there could be a DSP that priced ads in tokens, which would force market makers (yes, there are MMs in the ad world too these days) to buy HIVE off exchanges to buy the inventory.
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That'd be a great idea once Hive frontends became big enough properties to warrant the extra inconvenience (more likely coding by some media buyers/ad aggregators). In the beginning, it's not good business to make it harder for customers to give you money.