Burning Mechanism Can Save Hive From Continuous Dumping || HIVE at $0.04
It is very sad to see the price of Hive falling down. Finally, what we were afraid of happened. Hive touched $0.04 and rather it made another all time low even below that.
Certainly this is a matter of concern and certainly it is a point of attention for the active influencers that they should take this seriously and find a way to stop this dumping so that investors and other users do not get demotivated.
In my opinion the continuous printing of Hive that is unlimited supply is a very dangerous situation. What happens because of this is that when Hive is continuously printed its demand keeps decreasing.
In principle it should be that the maximum supply of any coin should be limited and after that supply the coin should not be printed again, just like the working mechanism of Bitcoin.
What will happen with this is that when the limited maximum supply is reached, no more coins will be printed and the coins that are in the market will keep circulating. This will have the benefit that its demand will increase. And when the demand increases its price will also increase.
So the important point is that there is no burning mechanism in the Hive ecosystem or Hive project. A mechanism should exist through which a certain amount of Hive keeps getting burned continuously so that its supply remains limited or it is prevented from being printed excessively so that its demand can increase.
HIVE FIGURE ON BINANCE
If you check on Binance, its maximum supply is showing as infinity. While its total supply is around 574 million.
The maximum supply is showing as infinity meaning there is no limit to its total supply. It can increase from 524 million to an even larger number which is not a very good thing.
In my opinion it is necessary to have a good burning mechanism for this which will protect it from a price drop and increase its demand.
The second important point is that the witnesses or the influencers should consider or make efforts to get Hive listed on other exchanges as well. For example KuCoin where Hive is still not listed. And there are many other exchanges where Hive coin is still not listed.
HIVE MUST BE LISTED IN SMALL OR BIG EXCHANGES
This reduces peoples interest and makes the coin less famous. So it is better that Hive should be listed on every small and large exchange with a specific narrative so that people become interested in it and start getting to know the Hive coin.
If, especially more focus is given to Hives burning mechanism and similarly an excellent gaming project is also introduced then this would be more beneficial and useful for the price of Hive.
The best solution would be for Hive to have some kind of burning mechanism that helps increase demand for Hive and reduces its supply. And since Hive is already quite popular in the gaming sector there should definitely be more focus on expanding and strengthening that sector as well...
What is your opinion about this continuous dumping of the Hive price?
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That's one thing that can alleviate the downfall. But we need to determine what is causing the continuous selling pressure: are the users or the DHF spending.
Spending more than half a million on this, doesn't look healthy or good for HIVE.
The HBD stabiliser is probably the one proposal I'm 100% happy to vote for, because it just swaps between HIVE and HBD, there isn't someone actually taking DHF funds completely out of the system.
It's the proposals that get put in with a "trust me bro" business plan that I hate, where someone is paying themselves for dev work but where the explanation of how it's worth the money spent is all fluff words and hand-waving.
I keep arguing that the DHF should be making loans not gifts.
If the funds are not going outside the system, then where are they being spent? And what is causing so much selling pressure?
My understanding is that the HBD stabiliser funds are a notional amount, used to swap between HBD and HIVE in order to try to keep HBD reasonably close to it's $1.00 peg (provided the Hive Debt Ratio is under 30%, but that's a separate issue).
The selling pressure is a combination of several factors - like all such things, there isn't a single simple answer.
The first is inflation, because we effectively print HIVE at will to pay author, curation and witness rewards.
The second is people extracting funds from the ecosystem; a mix of DHF funds used to pay for proposals other than the HBD stabiliser (some good, many bad, and most with no business case that explains the claimed benefit in financial terms), Hivers powering down and taking their HIVE onto exchanges to turn into cash, and witnesses pulling out their witness rewards in order to cover their server costs (and again, some don't, and some pull out far more than servers actually cost to run).
Finally, there's an overall feeling in the wider market that crypto-based investments have had their day, and that Hive isn't the exciting new thing it was a few years ago. Which is why I keep arguing that we need to be meeting real world needs using the blockchain but without actually making a point of saying it's crypto.
I completely agree with your last point. We should not look at the Hive ecosystem merely as a crypto project. Instead, we should bring it into real-world use and build solutions that address the needs of the world and understand what people actually need.
Just as in 2019–2020, #Splinterlands fulfilled the needs of gamers, and we saw a very positive result from it.
A content-writing platform is no longer as much of a necessity in this modern world. If we want to see #Hive grow, we need to go beyond that and build something more meaningful and useful.
We need to identify real-world problems, understand people's needs, and use Hive technology to provide practical solutions.
The main reason could actually be the DHF spending itself. Spending such a large amount is certainly not good for HIVE.
I agree, we definitely need a burn mechanism to reduce inflation. A fixed cap would be nice, but I can't see the whales going for it, at least not until the big extractors have taken all they are going to and gone elsewhere.
At it's simplest, the burn mechanism could be to match anything the DHF spends (other than the HBD stabiliser, which is a zero-sum proposal) and burn the same amount.