So let's fix a DEC oversupply by adding more DEC. This is just robbing future value in the game and it likely won't be enough to move the needle. We'll see another temporary spike in DEC price and as it gets close to peg, the selling will come back in and send it back down to where it is now. Then when these dec sinks come online in the future, less dec will be burned than would have been without this.
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We first have to get to that future. Don't take it for granted, bear is bear.
I agree. But padding the dec supply with DEC-b is going to make it less likely we do get to that future.
I can't see how. Can you help me?
Do you see how right now (since they've announced this) DEC has been collapsing in value while vouchers are up? DEC has dropped 20% since this announcement. That's the market telling you everything you need to know. If this passes, people are going to trade in their vouchers (not dec) for DEC-B. That means at the end of this we're going to still have almost all of the dec we have now but we'll also have 2 billion DEC-B sloshing around. This will make DEC less valuable. Not more.
But let's say for a second this doesn't happen and its 1.6 billion dec that gets burned. We still have 4.7 billion dec in circulation and now we have another 2 billion dec-b. Over the next year or so, if you're holding DEC and want to use it for some purpose that burns it, you'd be dumb not to go sell that dec and buy DEC-B on the secondary market and pocket the difference. DEC-B will be just a little cheaper than Dec due to its lesser features but it burns the same. So no one is going to be burning anymore DEC until DEC-B is gone. So what did they really accomplish other than adding 400 million DEC-B to a system that would still be sloshing in DEC?
And there is still 25-30 million DEC bring printed each month.
This is just a gift to the people who own all the node licenses who now have 50-80k vouchers and nothing to do with them. This is just a move to appease them so they don't sell. THis is why concentration of ownership is such a problem. THey'll hurt the whole economy to make sure a few people don't sell because those people own so much they would destroy the economy by leaving.
Thanks for answering. Of course since the proposal applied a 160 VOUCHER/DEC ratio the immediate market response was of selling DEC for VOUCHERS.
They want to fix both VOUCHER and DEC oversupply issue at the same time.
and it would be great if that were possible but its not with this proposal. Adding a bunch of decb to a pool of too much dec doesn't fix anything. And vouchers are only fixed if there's then a reason to have vouchers. Otherwise, the 40k per day oversupply (and the bigger problem of concentration of ownership in these vouchers) doesn't change. Even if they all get burned (meaning almost no dec gets burned) vouchers will still have all the same problems and they'll be back at a few cents within a week. Meanwhile, there's will be more burnable dec than we started with.
I totally get your point and agree, overall.
But let me speculate a little bit.
Right now market cap for VOUCHER is around 500k$ and for DEC is 3.5M$. There are 150k plot trading at 118$ each.. so roughly land plots have a 17M$ market cap. We can assume each land owner will have to spend 50% of plot value in buildings and upgrades.. and that 50% of that will be burned tokens (total speculation here, just to have a hint of the order of magnitude involved). There are out there millions of $ of potential sinks.
I think DEC-B is all about timing. Sinks will be available during 2023 but if economy twists earlier is better for everyone.
I think some sink will require VOUCHER and other DEC. So i would have preferred introducing DEC-B and VOUCHER-B... keeping stuffs separated. But people don't want new tokens.. so I understand this semplifacation and aggregation.