The problem with this article in terms of inflation is the same thing we always see.
Here is a discussion about the right rate of inflation yet there is no mention of growth of the economy or the ecosystem. People seem to think that money operates in a vacuum. Yes we can look at the rate inflation but in what context?
I have heard the arguments that the 20% is unsustainable and laugh at it. How can it be unsustainable if the growth of Hive economy is 40%? Considering where we are starting at, this is not a large number.
At the beginning of the year there was 14M HBD and now we are 8.5M. The savings has grown from 2M to 4.4M.
Here is the case in point: what kind of economy does anyone think is going to be powered by $8.5 million? Does anyone think this is a legitimate level of money to facilitate commerce, investment, funding, and collateralization?
10x that number and it still will result in a small economy.
Posted Using LeoFinance Beta
I for sure I'm not saying that 20% is not sustainable, and that is not the point of the post. Altough I have put some numbers in, to suggest that we are good to go at least for the next five years :)
The main point here is that I wanted to open discussion about how we set the interest rate.... what if from tomorow witnesses decide they put 5% interest rate, becouse they feel that is right at the moment? What if they put 30% .... can we have some priciples upfront? Can we say it is 20% forever?
I didnt mean to imply that you were saying it is unsustainable. Actually the article does the exact opposite of that, it concludes the inflation rate is not jumping much due to it.
They can change anytime, that is true. At the moment, there seems to be little incentive to alter it up or down since there is not much threat. Overall, the HBD market is rather slow developing so par for the course could be the present mantra.
Posted Using LeoFinance Beta
Thank you :)
Looks the same to me, and probably the interest rate will stay there for a while. Will like to here some thinking from the T20 ... smooth gave his opinion in a comment here, that is from a high perspective but reasonable what we want to achieve here. We just need to polish some details out .... probably will do it as we go.
8.5M really is next to nothing in that context. I guess the general view is that HBD becomes a risk for Hive if its supply increases too fast. But as you said, it makes sense for Hive to also continue to grow in the near future which would mitigate that risk considerably
Yeah, crank it up and let it sink into a crypto-defi system. Agreed. But if FUD takes over, you might have an interesting scenario at a 10x scenario.