My sharing: The sixth proposal, Inflation Rate, delegation rate, LikeCoin chain economy

A few days ago (23/11/2020), Guanyun @yuanyun put forward the sixth proposal , proposing that the inflation rate (the Chinese literal translation is the inflation rate, but in the world of LikeCoin, this rate is only valid for the hosted LikeCoin) , in fact, it is more like the interest rate. To avoid confusion, the source of this article is in English), which has increased from 2% to 7%, which has caused heated discussions among certifiers from all walks of life. Lao Mao also received a tracking notice. As a member, it is absolutely the responsibility and obligation to participate in the discussion, exchange ideas, and also take the opportunity to express ideas to the entrusted users.

For thinking about inflation rate, Lao Mao has always felt that at this stage, the inflation rate of LikeCoin Chain is a magic number, and there are some economic models and other blockchain networks for reference, but it remains to be seen how it is. . Since the current commission rate has not reached the target of 67% to ensure the security of the LikeCoin Chain, according to the basic economic principle, by increasing the inflation rate to increase the incentives, it should be possible to increase the commission rate to reach the target commission rate. According to the information provided by Gao Reconstruction @ckxpress , after the fifth proposal increases the inflation rate from 1% to 2%, the commission rate increases slightly (but there is still a lot of distance from the target), which proves that the economic principle seems to be reliable. The general direction of increasing the inflation rate is still correct when the spectrum is used together.

If you simply want to quickly increase the commission rate, of course, you can increase the inflation rate to an irresistible figure, so that most people who understand the benefits obediently commission Likecoin to enjoy high profits or avoid depreciation losses. However, this approach will reduce the circulation of Likecoin, because everyone is waiting for the appreciation, and the number of applause on Matter should be greatly reduced, and the generation of benefits or value may only be to cut off those who are not entrusted or still in the ERC-20 chain On the leek of the lingering LikeCoin holders. Therefore, for the processing of the Inflation rate, the old cat's method still feels that Trial and error, step-by-step adjustment is more appropriate.

Speaking of the sixth proposal, it is proposed to increase the inflation rate to 7%. According to Guanyun @yuanyun , it is mainly based on the current inflation rate of 7% of the cosmos mainnet. A brief look at the changes in the cosmos mainnet commission rate and inflation rate over the past year, the commission rate has risen from 71% in July 2019 to 74% in December of the same year, and has been slowly declining since then, and in May 2020 During the same period, the inflation rate dropped to 71%, and then remained at 71%; during the same period, according to the Cosmos blockchain mechanism, the inflation rate plummeted from 7.6% in July 2019, and reached the lower limit of 7% at the end of May 2020, and has remained at 7% since then. . In the meantime, what is interesting is the divergence between the commission rate and the inflation rate in the second half of 2019, that is, reducing the inflation rate did not lead to a decrease in commission but an increase. Referring to the price of Cosmos ATOM during the period, this divergence may be caused by the increase in the order of holders due to the decline in the price of ATOM. Another phenomenon to note is that after May 2020, the inflation rate and delegation rate of the Cosmos blockchain have been very stable, remaining at 7% and 71% (hereinafter referred to as the "771 phenomenon"). During this period of time, ATOM actually had a big increase, but this rising wave had little effect on the inflation rate and the change in the commission rate, which is worth studying. If the lower limit of the inflation rate of Cosmos blockchain can be lowered further, the delegation rate of Cosmos blockchain should have the opportunity to continue to move towards the target value of 67%. (Note: In fact, the inflation rate of the Cosmos Hub is also affected by the block time under certain conditions, but the current conditions are insufficient and have no effect)

I don't know if the "771 phenomenon" will reappear in Likecoin Chain, but the community characteristics of Cosmos blockchain and Likecoin Chain are quite different. However, since it is proved that 7% inflation rate can generate a higher commission rate and the commission rate of LikeCoin Chain lags far behind, I think it is reasonable to choose 7% as the next inflation rate.

In addition, I set a range for the inflation rate based on the practice of the Cosmos Hub (Note: the Cosmos Hub is 7%-20%), and the value is based on the commission rate and the adjustment range (Note: The inflation rate of the Cosmos Hub is based on The difference between the actual commission rate and 67% (adjusted at an annual rate of 13%) is in agreement. One of the considerations is whether the modification of Likecoin will consume a lot of resources. If the resources permit, it is worth considering, otherwise it is not unreasonable to directly modify the old cat in the form of a proposal. If you really refer to the practice of the Cosmos blockchain, the parameter setting also requires everyone's participation. This part needs to be discussed and studied in depth. The old cat has not many ideas for now.

(I originally wanted to attach the Cosmos Hub's commission rate and inflation rate charts for your reference, but I couldn't find it. If a friend helps me, I will make it up. Now there is only the price chart of Atom.)