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RE: SPS Governance Proposal - Raise the SPS Rental Floor Price

in #spsproposal14 days ago

In response to your follow up I would first like to remind that the rental market was set up when SPS replaced CP as a playing requirement. The staked SPS requirement was deliberately set at levels that would stretch the average player. The rental market was to allow those deficient in SPS the option of renting while offering a passive income to those with an excess SPS holding. The whole idea around the staked SPS requirement was to give value to SPS and stop holders from dumping SPS which was in an unstoppable inflationary death spiral in the middle of the bear cycle.

You claim that rental demand will drop as a result because players will just do with less and initially I would agree. Without new players I would also expect the rental demand to slowly decrease over time as some of those renting would be accumulating. Does it really matter if players rent less? not to me anyway.

The real issue that you are walking around is on the supply side. There is much more staked SPS available now than there is demand for renting it. You are concerned that by raising the floor rental income will be harder to get because bots will fill bids faster and the greedy bots will get all of it. Based on your concerns @clayboyn should investigate and report the extent of rental bots and describe what the DAO's position is regarding them. I agree that it is an unfair system if bots are being used and not everyone has the ability or means to use them.

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thanks for the clarification.
I suspect we are in agreement here: in my view the supply side of staked SPS is far more than we need for our current playerbase.
And the path forward for SPS emissions is an important conversation (and we should have that conversation as soon as possible!), but this proposal isn't really likely to change much about the supply side - it's going to remain available in excess, and stakers will gladly rent their excess for whatever yield enhancement they can.

So instead of more attempts to brute-force market dynamics against established economic theory, I'd much rather see something done to either
a) slow down the supply side, or
b) increase the demand side.

This does neither of those things.

My concern isn't really about the bots - I only mentioned them because it was part of the "rationale" for why this proposal is here. My concern is about reducing SPS demand with an artificial floor, where reducing rental demand actually means reducing utility for majority of SPS owners.