The Big 100% ROI/Inflation Thread


#1

Good day divi boys and girls.

I have been thinking about the Divi minting rate/100% ROI/Inflation rate a lot the last few weeks and have come to the conclusion that the right thing would be to change it.

A 100% increase of coins in a year =

Year 1: From 600.000.000 million to 900.000.000 billion.
Year 2: From 900.000.000 billion to 1.350.000.000 billion
Year 3: From 2.025.000.000 billion to 3.037.500.000 billion
Year 4. From 4.555.250.000 billion to 6.834.375.000 billion.

This is pretty crazy numbers. Even worse, the new coins, around 50% we assume ends in staking wallets and masternodes and produces even more inflation! In reality inflation will be around 150% year 2, year 3 around 225%, year 4 around 337%. So it explodes in reality. A thing that is fine if the total coin supply is only 6 million from start but not if it is 600 million.

Because of the 1:100 coin swap it does not give meaning anymore to me to have this high minting rate.

The primary reason for the doubeling of coin supply a year was we started at only 6 millions Divi so we wanted to fight the coin price becomming the new Bitcoin with crazy high price scaring normal people from using divi because of the mental factor. Let us call it the “gold and bitcoin scary high price a unit” effect.

To make Divi much easier to sell the goal was to have the price closer to fiat prices. Look EOS, priced 5 USD a coin curreny. That was the goal or under a dollar like Ripple or IOTA. To not scare people with high prices, better let people think something is “cheap”.

But with a 1:100 coin swap the high minting rate loses it initial reasoning.

Even if we assume that 50% of minted coins ends in staked wallets or masternodes.

And on top of that is 100% inflation a year not a good selling point for acrypto currency in general. Why this question always is asked by newbies to Divi that read the Whitepaper.

Inflation is a bad word because it is the devil of FIAT.

I’am now a days i’am liking a Minting rate/ROI/Inflation rate of:

50% the first 2 years
40% the next 2 years
30% next 2 years
25% forever. ( this can be changed later through masternode voting and most likely will be down the road)

But because of the 1:100 coin supply increase, the minting rate does not give sense anymore, and when we change that positive is the coin price will just be 50% higher. So We the investors do not lose money at all. The coins minted will just be worth 50% more.

But the end result is a product/Service that is much easier to sell to the 99% = mass adoption.

Lower inflation from 100% to 50% is a big selling point and we killed a primary argument used by many to why not to buy Divi.

50%
40%
30%
25%

and we assume around 50% of minted coins ends in staking wallets/masternodes.

Remember no investor loses money on this, the coins you mint will just be 50% more worth.

The easier The Divi Project is to sell to News papers, News Websties, Merchants, Companies, Hedge founds, Wall Street, and normal clueless people who get scared of the word “inflation”. The easier it is to sell to everybody the more succes = The bigger Adoption Divi gets, and the coin value goes up.

Have a nice day everybody and please sit and think about it for a moment before you answer you first thought on your mind.

@geoff
@nicksaponaro
@Michael


#2

Funny thought that hit me.

The first year I could imagen that close to 100% of coins ends in staking wallets/masternodes.

It is first when divi begins to be used for daylie trade of good ands services that the users go from “masternode/staking investors” to “normal coin holders/users”

As long as all divi is only used for staking/masternodes the assumption that 50% of coins do not mint new coins is not correct.

And they will be until you can buy things for divi, and untill the coin price rises so high that normal people can not afford a masternode any more.

First when this 2 things happens the assumption that only 50% of newly minted coins end in maternodes and produces inflation is correct.

So the first 1-2 years most likely the inflation rate is much higher than we calculate for.

So my calculations with 50% coins in masternodes/staking wallets will be wrong the first 1-2 years and inflation will be more like 200% a year than 150%.

200%
400%
800%
1200%

This would lead divi to be nick named “the inflation coin” no joke.

Masternode coin + high inflation = inflation just like in the fiat world - out of control.

Guess that is why the whitepaper says it should be lowered every 2 years. But the lowering rate in the whitepaper of the minting rate is far too high for the new 600.000.000 million coin cap imo. It never goes under like 65%

It sounds realistic that in 5 years the assumption of 50% coins is in masternodes/stakes wallets and 50% is just sitting in wallets. Or maybe in 3 years. But this is not likely in 2019, and also not likely the case in 2020 either.

There is no advantage in letting the inflation go rampage the first year and change it when the damage have been done the first year to The Projects reputation. Countless people said the inflation rate was total out of sense and I admit it is with the 1:100 coin swap. A. But the idea was good when the coin cap was only 6 million.

@geoff
@nicksaponaro
@Michael


(OriZ) #3

It’s not 100% a year. It’s 1.2 billion, 1.9 billion, 2.5 billion, 3 billion, 3.5 billion, 3.9 billion, 4.3 billion, 4.6 billion…etc up 340 million a year roughly from there unless changed by governance. I rounded everything up but you get the gist.


#6

The edit error is so anoying >_>


#7

You said your self it is 100% and 2.72 coins minted each 1000 coins ( copper masternode ) is exactly 99% inflation/ROI a year. Without masternode bonuses.

If we assume 50% is locked in masternodes or wallets your right. Then 50% of new coins wont be producing new coins. I made a mistake there. But if you read the second post you realize it will be around 100% increase the first 1-2 years most likely more or less.

My 3d post outlined the compounding of minted coins to around 200% coin increase at the second year due to around 100% of coins being in staked wallets/masternodes until Divi gets used for buying services and goods. But my pc crashed just before I clicked “publish”

When you only can use divi for staking in a wallet/Masternode then you get 100% coins staking first 1-2 years = 100% coin increase + compounding from the new 600.000.000 coins also producing 100% inflation in a year. The problem only arises when a masternode coin has too high minting rate. Like Divi with 100% then it ends in fiat and the banking system 2. Because of compounding and no real world use case first 1-2 years I assume.


(~ Node of the Realm ~) #8

I’m not really getting the theory much… Say in 3 years we are really picking up with mass adoption, and there are 2.5 billion Divi … say there are 20million users, thats still only 125 DIVI per user at the most basic maths. Doesn’t seem like too much coin generation to me.

So even 2 million users averaged to equal holdings is 1250 DIVI each

Or are you saying we aren’t generating enough DIVI?


#9

Hmm that was a simple and valid argument.

I liked the 600.000.000 million coin cap in it self. And felt it would like it would fit perfect that 1 Divi will cost around 1 dollar at top 25 on the old 800 billion market cap top 100.

So all this unforeseen inflation ( 100% + compounding the first years) just totally destroys that picture of Divi costing around 1 dollar at around 25 billion market cap if I remember correctly.

So I used the top 100 list to evaluate what coin cap would be fitting to hit the projected price somewhere around the dollar price.

You use another method.

And then my second concern is the reputation of The Divi Project.

Yes, 1250 or 125 divi a divi user sounds even in the low end maybe I dont know if projected 3 years ahead. But 50% or 100% minting rate and the word “high inflation” is one of the most anti crypto/decentralization words you can use. And sadly an argument you can use about The Divi Project to why it will fail, or why you should not invest, or dare to buy to use it.

We all knew Divi had high Inflation that is one thing, but now we discovered it leads to uncontrollable Compounding Inflation like the fiat world. Had I known that from day 1 I had never used time on reading the Divi whitepaper or Invested. So this is a real adoption killer both for investors and the 99% if you ask me. Not that it seems as a problem as you outlined, but just by hearing it most people will be turned off.

Normal people are not so educated or intelligent, they dont understand inflation and all that economical jazz. But they know fiat = inflation = bad. The bitcoiners love to use that argument against any PoS coin. Because inflation is 100% controlled with bitcoin. There can never be more than 21 million Bitcoin. Bitcoiners remind me of the 99%. Really simple thought process, shys anything that is not 100% the opposite of fiat.

How are Divi going go be used in Africa where their old currency died to Inflation. They for sure will be turned of if they hear or read the whitepaper that Divi has high Inflation. 50%+

So it may be a marketing problem more than anything else after all.

I would like to have the teams view on it. They are the only ones who really know what their plan is and if this was predicted or not.

It came as a surprised to me that the real infaltion the first years will be like 2x,3x,4x what the whitepaper says the first years.


#10

Lets say we do not change the inflation rate in the end. Then I think we should be better at telling why it is so high and why it will work as planned. And I think it should be on the website and in the whitepaper the reasoning and explanation behind it. 99% of humans will label it a shit coin and that it will die off the inflation. I have read it with my own eyes several places in general and as argument against divi.


(OriZ) #11

100% is first year only…I think inflation is perfect just the way it is right now. need coins for mass adoption.


(Johnny401View) #12

Interesting topic, I think it’s important and will pay more attention to it in a few months. My only real focus now. is helping us get through redemption.


#13

First 2 years.

And it nearly dont drop every 2 years. Even after 6 years its still around 65% inflation O_O

The numbers are huge for inflation. We must admit that. Never in my life outside of crashing fiat currencies have you heard about this kind of inflation. And it is a total turn off for normal people unless you give them the big explanation + questions. And that is impossible to give the whole crypto space to not end like the “inflation coin of crypto”

You try sell a crypto with 50%++ inflation to somebody not too sharp lol.

It is nearly impossible to a 99%’'er. - they have the lowest finanical IQ you can imagen.

Try sell it to a bitcoiner lol. im-possible.

I’am painting a picture off even if the huge inflation is not a negative - try convinence the 99% that and you will hit a wall. They wont even be listening to you or cant understand and think’s it is alien and you lost them.

25% inflation you can sell. But not 50%+.

We are talking marketing.

I have heard it many times on telegram. From people who even invest in crypto! Not even a 99%'er.

This kind of rumors spread like the wind in crypto.

But now I have said what there is to say and I wont repeat my self any more.

Now the rest is up to the team.

Have a nice day :sunny:


#14

Indeed an essential subject.


(OriZ) #15

No not first two years, only the first year. This is the first 10 years:
Year 1 - 106%
Year 2 - 52%
Year 3 - 28.5%
Year 4 - 22%
Year 5 - 15%
Year 6 - 13%(not 65%)
Year 7 - 8.6%
Year 8 - 8%
Year 9 - 7.4%
Year 10 - 7%

I actually have it plotted all the way to year 91 where it’s 1.05%. The reason why I am showing the first 10 years is because I believe we’re right around a full decade away from some real mass adoption, as far as use goes not only investment. That’s where inflation will matter most and whlie 7% is still moderately high(for example the FED’s target rate is usually around the 2% mark) governance can always change it at the time.

I think you are making several flawed assumptions:

I’m really not sure how you came up with that. Inflation is fixed and the coins minted are set in stone, who holds what where has no bearing on that.

The only reason is simple: originally, inflation was going to be about 10%…had the ico met the hard cap. Divi was hoping to sell 60-80 million coins and only sold 6 million. Hence, we went from 10% inflation to 100%.

That was not the main selling point of the 1:100 ratio and even at the time during discussions I had said I wished people would drop the price aspect of it and concentrate on so many other benefits of it, all of which I stated at the time. Cheaper price might help a little, but there’s a whole lot more to it than that.

That’s nothing but speculation there’s absolutely no guarantee that this will happen.

Coins are not minted per masternode, they’re minted, and masternodes split that between each other(along with stakers).

huh, that is not true. You’re working backwards, looking at projected ROR for masternodes and compounding that, masternodes only receive coins that are already minting…they don’t mint new coins so they can live up to their projected ROR, that ROR is wholly dependent on the number of nodes in the ecosystem. That’s why the calculator was built the way it was built where you can change the number of each tier, the number of coins minted, etc.

Divi’s transaction fees also get burned…while the fees are not high so it’s not going to amount to much, it will still lower inflation to a degree(depending on how many people use the ecosystem, run masternodes, send money, etc).


(Geoff McCabe) #16

It should be projected to be like the following. The inflation is high in the beginning, to be attractive to help grow a bigger community and a strong network.

Block Rewards Total DIVI Inflation Rate
617,160,700
2018-2019 Year 1 1250 1,274,160,700 106.46%
2019-2020 Year 2 1250 1,931,160,700 51.56%
2020-2021 Year 3 1050 2,483,040,700 28.58%
2021-2022 Year 4 1050 3,034,920,700 22.23%
2022-2023 Year 5 850 3,481,680,700 14.72%
2023-2024 Year 6 850 3,928,440,700 12.83%
2024-2025 Year 7 650 4,270,080,700 8.70%
2025-2026 Year 8 650 4,611,720,700 8.00%
2026-2027 Year 9 450 4,848,240,700 5.13%
2027-2028 Year 10 450 5,084,760,700 4.88%
2028-2029 Year 11 250 5,216,160,700 2.58%
2029-2030 Year 12 250 5,347,560,700 2.52%

(OriZ) #17

didn’t realize it was changed so that it keeps going down past year 8. good to know.


(Geoff McCabe) #18

It’s going to be up to the community to decide what they want. This is just a projection and it’s not set in stone the way Bitcoin is. Not knowing what the future holds, we want to have this flexibility to be able to adjust to make sure we can always be in the strongest possible position.

Here’s another projection, with the block rewards decreasing slightly differently which would actually be a bit better for the team because the rewards would be more even.

Block Rewards Total DIVI Inflation Rate
617,160,700
2018-2019 Year 1 1250 1,274,160,700 106.46%
2019-2020 Year 2 1250 1,931,160,700 51.56%
2020-2021 Year 3 1150 2,535,600,700 31.30%
2021-2022 Year 4 1050 3,087,480,700 21.77%
2022-2023 Year 5 950 3,586,800,700 16.17%
2023-2024 Year 6 850 4,033,560,700 12.46%
2024-2025 Year 7 750 4,427,760,700 9.77%
2025-2026 Year 8 650 4,769,400,700 7.72%
2026-2027 Year 9 550 5,058,480,700 6.06%
2027-2028 Year 10 450 5,295,000,700 4.68%
2028-2029 Year 11 350 5,478,960,700 3.47%
2029-2030 Year 12 250 5,610,360,700 2.40%

#19

I no where in the whitepaper have ever seen this.

Dunno where you get this from.

This is from the whitepaper

" Reward System Payout:

  • 1250 DIVI minted per block first 2 years
  • 1050 DIVI for 2 years
  • 850 DIVI for 2 years
  • 650 DIVI after that - okey its not over 65% but around 51% + compounding. So likely around 75%.

#20

Okey, see this gives more sense than what the whitepaper shows.

And yes it can be changed.

That list should be in the whitepaper so people stop calling divi for a inflation coin that will fail. So simple a fix for such a strong argument.

And we would have much more people interessted in this project. Like, A LOT more.


(OriZ) #21

That is exactly the same, I just calculated with some easy math the inflation % out of it. It’s the exact same as Geoff posted as well…I’m not sure how you figure out inflation, but inflation for year X vs year Y would be supply for year X divided by total ending supply for year Y. This is exactly what both Geoff and I did and like I said I have a list just as detailed as his with %, supply, and even market cap(based on price entered) going all the way out to year 91.

I agree with you that the white paper stops at 650 and Geoff continued it, which would explain the difference we had after year 8 but the rest is the same.


#22

I like the new explanation blog post about The Divi Project’s inflation rates. It was needed. Now we can always link to that blog post when people ask to the inflation/minting rate. :sunny:

The first inflation blog post was so old that I think even I had overseen it. Even when I thought I had read them all.