Harmony is one of my favorite projects right now, but I’m getting a little concerned about the future.
There isn’t enough use right now generating fees to pay reasonable staking rewards, so what happens when the unmined supply runs out?
All the possibilities I can imagine essentially end with a low amount of staked coins and few validators, uncomfortably centralized.
Is there any plan to burn more to be used as rewards?
- wallet activation fees
- staking expiration
- inactive wallet fees to reclaim inaccessible wallets
- unstaking fees
- longer staking commitments that distribute rewards weighted toward longer freezes
Oh my god I need to get my money out of Harmony.
What’s wrong. Where are you going. Tell me your fud
My couch is available
Right now staking rewards are paid by minting ONE. As ONE approaches the supply cap, the only staking rewards available will be gas fees, which are super low. Harmony recently hit the 4 million transfers, and that cost <100 ONE.
The Visa payment network does an estimated 150 million transfers per day. Assuming Harmony got to that point, it would only be generating 3150 ONE per day. Staking rewards would be minuscule. Like well under 0.1%.
So, does the network increase fees? Fast blocks and low fees are two of the strong points.
maybe someone can correct me if I’m wrong, but gas fees will not be staking rewards. there is a set finite amount of ONE produced every year and that amount will not change. In fact, I think a common misconception about Harmony’s tokenomics is that there is a supply cap. There is not one. The goal is for the fees collected (and burned) and the coins minted as staking rewards will eventually result in a net zero issuance. Even if no ONEs are burned, I believe the amount that many falsely consider to be the supply cap would not be reached for roughly 7-10 years. Factor in the many reasons for ONEs to be burned (fees, stable coin issuance, etc) and the ‘max supply’ may never be reached if Harmony is successful in its mission.
Well explained by harmonious:
Here is the tokenomics article:
Its an inflationary token, coins are minted for staking, fees get burned. And for the time beeing mint > burn. The good thing is, that the staking rewards will never be low, thus independent from transactions. In some way: When you stake you hedge yourself against inflation.
What’s the FUD about? Enjoy the ride, it’s gonna be great!