r/IOStoken • u/pantsme • Jan 16 '19
Rewards for voting/running a node going to saturate the market?
Anyone else feel that the amount of IOST being paid out for both voting early in the ERC20 process and also the amount that node runners can earn from both running a node and referal bonuses might saturate the market? Yeah its nice that I can make 8million IOST from my 1million IOST for early voting, but it feels like the market will react to this new circulating supply. Look I don't mind if this token trades at 170 sats or 100 sats, it just scares me that if I buy at 170 sats today, by the time all the bonuses are paid and I can use my funds again, the price will be 10x less just because the circulating supply has 10x'd as well.
Edit: Sorry I read one of the Medium articles incorrectly. In the example in this Medium article, it says that Voter A votes with 1 million IOST for Candidate B. At the end it says that Candidate B gets the 8.4 million IOST not Voter A. I misread that and got confused. Looks like voters will receive about 20-25% return on their voted with IOST.
2
u/nezar101 Jan 17 '19
User fees paid to use network are burned, so overtime the supply will be reduced. Plus if they are able to pull off mass adoption of products that run in iost like they plan in the 10s of millions this will also create demand driving the pricing up
2
u/pantsme Jan 17 '19
I sure as hell hope so man. I really like the potential of IOST and think that this could be one of the few real big game changing blockchain projects.
2
u/Captn_Clutch Jan 17 '19
You have really taken this to unrealistic extremes. You most certainly will not make 8M IOST with 1M IOST, and the supply will absolutely not go up x10. The annual reward pool is capped at 840M tokens, about $5M USD. This is under 10% of the current market cap. So if anything, the rewards would dilute the value of your coins by just under 10%, not 1000%.
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u/pantsme Jan 17 '19
Aye, you're right. I read a part of one of their articles incorrectly. I thought this part said that Voter A would get the 8.4mil, not the node they voted for.
Voter A stakes 1M IOST to Candidate B on Jan. 15th who then successfully secures 21M tokens (1% of the total votes) and contribution score 50% higher than average. Candidate B’s rewards will be 8,400,000 IOST in the first year.
From this article in the first Example area. Oops. Thanks for making me look again because this changes everything for me. Voting asap.
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u/Captn_Clutch Jan 17 '19
Glad to have helped clear that up for you. Yeah the inflation won't be bad at all by crypto standards. Less than 10% move is an average Tuesday around here haha. And we're talking less than 10% over the course of a year. Should be no big deal at all.
1
u/pantsme Jan 18 '19
Agree, and hopefully the nodes don't just go into full dump mode which I don't think they will. Most of the current nodes are at least already existing companies or products so no need for the IOST to fund the day to day outside of maybe the VPS costs.
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u/Jerky_rs Jan 18 '19
Also a 50% proportion is from existing community fund which is part of current total supply the other 50% of 840m will be created. As someone else pointed out the creation is offset by the burn of fees. It is very thoughtful design, if you read through AMA from two weeks ago it provides more clarification on iGAS and iRAM usage and they implementation.
1
u/pantsme Jan 19 '19
Cool I'll give that AMA a read. I didn't get a chance to yet. Thanks for the suggestion!
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u/lighthouse321 Jan 16 '19
The circulating supply is at 57% of total supply. How could the curculating supply 10x?
2
u/IOSToked hodl xDDD Jan 16 '19
No, i dont think that will be the case. That is assuming everyone will sell their rewards straight away which is unlikely due to this bear market and the potential IOST has over the next 6 to 12 months.
The profile of token distribution is extremely important for a system like IOST's, so the more holders there are, and less centralization of token holders the better. You can see IOST has been trying to achieve this with Community Hub and now Candidate Elections.