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RE: Is Staking Sustainable? Insights on the Hottest Crypto Trend.

in Project HOPE5 years ago

Very interesting topic.
I was naturally brought to staking because, while it doesn't appear so, it is quite similar to our current system. We all have money in bank accounts. Said banks couldn't function without that money (even without 10% of that money in most cases). Yet, the interests they offer to let our money sit there is quite low compared to crypto-assets. Even Dollar-Stablecoins can be staked for 5 or 10% of certain exchanges.

Now there are features (slashing, premining, decentralization...) and adaptations of staking (KAVA, Avalanche...) I'd love to discuss, either here or in a future post.

I don't know anything (yet) about STP but a 30% yield sounds worrying to me. If the supply is to be increased by 30% in order to provide such interests, one should wonder how inflation is going to be inhibited. Also, if coins aren't pre-mined, one could worry about being taxed on those earnings.

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Inflation should be countered by buybacks, which are pretty frequent in the case of STPT.
It remains to be seen how other projects counter inflation. With the exception of exchange token burns, there had been no other precedent of counter-inflationary measures.

STPT's setting bar higher.

Yeah I guess they usually aim for a lower inflation and hope/build value in the system to counter it naturally.
I'm sorry to be doubtful, but you know what they say, when it appears too good to be true, it usually is. This said, I'll do my own research and come back to apologize! :)