What Is The True Max Supply Of Hive?
Am I the only one who wonders about the Hive supply system in the future? This is a thought I have had in my mind for a very long time but always forgot to make a post about it or ask a question.
Let’s start by asking, how is the Hive coin generated? Unlike bitcoin that has a fixed bitcoin supply amount which is 21 Million, and it’s mined off the blockchain through a mechanism known as the proof of work mechanism, Hive is different and works on proof of stake. Does Hive have fixed supply of token or rather a fixed max supply like bitcoin? From my observation since I have been on the Hive blockchain, I don’t think so, or just may be I will make this post as a reminder for my research.
The bitcoin coin is generated when validators validate nodes on the blockchain and mine bitcoin, they then get rewarded with bitcoin, but the mining rate decreases by half every 4 years making it more difficult for more bitcoin to get mined, meaning that the possibility of getting all the bitcoins off the bitcoin blockchain will take over 50 years. Cool right? But with Hive, the coin is mined on a proof of stake, proof of brain basis, where a person with some Hive stake(Hive Power) curates an author. This is when the blockchain rewards the author and curator with some Hive in form of Hive power, voila Hive has been mined off the blockchain.
The Hive blog is constantly filled with numerous blogs, this makes lots of to get mined off the blockchain. From my observation, the increase in the value of Hive makes it way harder for more Hive to get mined. For instance, if the value of Hive is $1 and your vote value is $10, this means that the curation rewards will be 5HP and author reward will be 2.5HP and 2.5 HBD. But if the value of Hive is $0.1, and vote value is $10, curation reward will be 50 HP, author reward will be 25 HP and 2.5HBD. You have more Hive when the value of Hive is down and less Hive than when the value is low. Now let’s look at a scenario where the value of Hive is $10 and vote value is $10, you will end up having a curation rewards of 0.5 HP and author reward of 0.25 HP and 2.5 HBD. Have you noticed what is constant in all these? HBD.
But then, people are constantly posting and Hive is getting generated everyday, does that mean that the supply of Hive is unlimited? Is there a periodic burn of Hive to reduce the supply and keep it constant? Well, my research starts now as I am using this post to keep record. According to the data from Hiveblocks, the current supply of Hive is 385,587,440. These figure is expected to increase by next week because more supply will be generated from author and curation rewards and we will have more Hive on the blockchain.
How does the blockchain system maintain a limited supply of Hive and not make its supply unlimited? Well, check out my blog few days later when I do my research.
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In my own view I think Hive has an unlimited supply as we can never stop mining Hive through our activities on the Blockchain.
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I thought so too
Hive base inflation keeps going down every year for 0.5%. Now around 7%, and will decrease to 1.5% and stay there.
Thing is the conversions disrupt this and increase or decrease it.
Last year for example inflation was negative. I do the monthly posts about it.
I tried reading your post one time about it, but I couldn't understand it. I felt it was too high for me to comprehend, but I will give it another shot so I can understand how this works
Dalz is wise beyond his years.
MAybe on your next post you can talk about the witnesses cut from validating and maintaining the blockchain running and the price oracle.
Interesting subject you have a task on your hand.
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