Hive Power Down Period | Can We Make It Better?
The ever-discussed topic around here. Thirteen weeks power down period. Each week 1/13 of the stake converted to liquid.
Word on the street was that during the TRON Sybil attack on Steem, exchanges were amazed by the 13 weeks power down period. Looked quite a lot to them. Well now they know it 😊.
The power down period is in line with the overall staking rewards topic for Hive. I have written about the Hive staking rewards before:
The overall conclusion there was that Hive staking rewards are great. They can go from 13% to 20% APR and are one of the best in the crypto industry. What can be improved is the UX, make it easier for delegation and receiving daily rewards. A one click integrated button in the wallet.
Before going forward let’s take a look how things stands with the other DPoS coins and their unstaking period:
- EOS – 3 days
- TEZOS – 21 days*
- TRON – 3 days
- Cosmos (ATOM) – 21 days
- ICON (ICX) – 5 to 20 days
Compared to the above, Hive 13 weeks or 91 days, looks quite long. The longest unstaking period for the coins above is 21 days.
Most of the Hive Engine tokens also have shorter unstaking periods. Usually around 4 weeks.
It almost feels like a no brainer to shorten the time. On the other side we have seen a price increase to 1$ recently with the 13 weeks power down period.
Sometimes it looks like fundamentals don’t matter much in crypto at this stage of development.😊
However, lets explore this topic once again and see will we make some meaningful conclusions.
Let’s go into some pro and cons of shorter unstaking period.
Pros for shorter power down period
- Investors will feel more comfortable locking their stake for shorter period,
- Attract more investors just for the passive income,
- It might increase the overall share of powered up Hive,
- less liquidity, more scarcity and drive the price up
The pro of the shorter power down goes in the direction of making investors more comfortable in powering up hive as they will not have their tokens staked for 3 months. If this happens it might increase the demand for the token, reduce liquidity and push the price up.
Cons for shorter power down period
- Putting the importance of the short term over the long term,
- Attracting speculators that have no long-term commitment to the project,
- Decreased stability of the network,
The cons seem to be in the direction that short power downs will attract more speculators then a long term investors. This will make the token more speculative asset then a long term project. At this point I think that almost all crypto is speculative, but lets just add this here as well.
What are the other options?
Can we think of other options, then just shortening down the power down period?
Options that can make investors more comfortable powering up HIVE without feeling trapped.
One of the proposed options was from @theycallmedan where people can make instant power down for a fee. Meaning one can power down in instant and burn some HIVE in the process. Let’s say 10% fee.
This means that there will be a fixed fee for converting Hive Power to liquid HIVE.
Another interesting option would be to try and introduce the free market to the power down period.
What this means is creating a market for Hive Power to HIVE, where HP can be traded for liquid HIVE. How much would it cost to convert HP to liquid HIVE will be decided from the market conditions.
I imagen when the HIVE price will go up more people want to cash out, meaning that HP will become cheaper. This can be used for someone who wants to accumulate more HP. When there will be no significant moves in the price the market will be more or less stable.
Introducing a fixed fee for instant power down or a fee decided on the market will bring some additional security risks. If an account is compromised the hacker can cash out immediately. A solution to this can be a two factor authentication where more than one confirmation will be required.
I personally prefer a market solution for Hive Power to HIVE conversions. But I imagen creating such a market on a blockchain level would require quite an effort and will be complicated to pull it off. Shortening the period to four weeks might be more simple and elegant solution.
Still its worth debating these things and see if some of the top developers can look at it.
What is your opinion on the topic?
All the best
@dalz
Posted Using LeoFinance
Tweet:
https://twitter.com/Dalz19631657/status/1286655220144111617
Posted Using LeoFinance
I agree with you. 04 weeks powering down period would be ok. I want to invest more in HP but i am afraid of its long powering down time. On the other hand, simply putting Hive in my account has no effect on my vote value until it is converted into HP. I hope some developer will think about it.
Cool!
One for the 4 weeks.
My guess is that speculators would stay liquid anyways. Shown by the large amount of liquid Hive stored on exchanges.
I prefer a 4 week power down period.
4 weeks seems to be a preferable options.
The second option looks good to me.
What exactly? 4 weeks or market for HP to HIVE
Market for HP, i don't know if it's possible but sounds nice.
Nice to know this information 👍
I think we should adopt a variable staking period, with longer periods giving greater staking rewards.
Posted using Dapplr
That is an option to!
This.
What are the reasons for for the savings feature in the hive wallet? Does it do anything? Do you get any return on money put into saving? Nobody has ever explained this to me. Possibly if the saving feature could be used as an alternative to staking or as a compliment. I don't know. Just an idea.
Posted Using LeoFinance
I think 4 weeks would be much better than 3 months.
I like the 4 week option
Posted Using LeoFinance
I like the market price suggestion. Leave the 13 day power down, and let people directly exchange liquid Hive for HP. Let's see what the price for time preference really is.
I 100% support a market solution. Seems like a no brainer no that it's been thought of!
Posted Using LeoFinance
The market solution is great, but probably the hardest to implement as well.
Nothing good comes easy, perfect is the enemy of good!
How about a delegation with an option to buy? The HP is already in somebody else's control. The delegator can set a price to buy the HP. Perhaps the option becomes available after 21 days of delegation. This could be a means of buying HIVE as an OTC transaction.
Posted Using LeoFinance
Taking into account the pro and cons
#hive needs eyes to grow and bring value.
We need to find the right combination and get rid of anything #steem used to do.
Finding the balance of power down will be a no brainer for newbies and investors alike.
I think lessser pressure on the powerdown time will open the gate.
This type of discussion is the epithet of the community and we will know where the growth of #Hive is heading.
Now the most important question is:
Is the status quo system benefit a group or the whole community?
Posted Using LeoFinance
The long term vesting model works and when Steem decided to cut it to four weeks they just pulled the plug. I think 90 days is good as it provides stability. Powering up is a commitment to the platform. If you dont like the power down time then keep your Hive liquid or hold Hive Dollars instead. I like the balanced approach.
My vote is for four weeks as well
2 years power down period, as it was introduced in 2016, seems to be just fine for me.
However it should be complemented with the "Turbo-button" to allow 4 weeks "emergency" power down, presumably something like 10-20 % from the stake burned during the process.
I think what you can do is keep the 13 weeks but use Dans burn method and for every week you want to shorten it you pay a higher percentage
4 weeks here as well.
I don’t know if the current dev talent can implement the more complex HP market.