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RE: Burned tokens, rewards, and inflation summary November 19, 2022 - Total burn estimates: 168,687K STEEM/SP and 63 SBD

in #blockchain-metrics • 2 years ago

Hello! I came across an old post: https://steemit.com/utopian-io/@lostmine27/the-current-actual-inflation-rate-of-steem-is-quite-different-from-the-design-1545151936259

Could you tell me what is the current annual inflation of the STEEM token and is it in line with the project?

2 years ago in #blockchain-metrics by
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     2 years ago 

    If I did the spreadsheet right, here's what the overall decline should look like, so 7% is right on target.

    image.png

    My understanding is that the "current_supply" inflation rate should always match the target, but the virtual_supply might vary a lot, depending mainly on the price of STEEM, so I guess the previous analysis was basically backing into the virtual_supply number.

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     2 years ago (edited)

    Thank you for your answers and valuable information. I am interested in this topic and I knew for sure that I turned to the right person.

    It is interesting in what way the inflation reduction is planned. From this post I understand that due to the reduction in the reward pool. Interesting. Of course, the developers predicted a constant increase in the price of STEEM, so the reduction of the reward pool is logical.

    Is it fair to say that approximately 420271729.51 * 0.07 = 29419021 STEEM will be "printed" during 2022? (80,600 STEEM/day)

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     2 years ago 

    Is it fair to say that approximately 420271729.51 * 0.07 = 29419021 STEEM will be "printed" during 2022? (80,600 STEEM/day)

    That's a decent estimate, but it's more complicated than that. And as I think about it, I guess I don't even completely understand all of the relevant factors. Some of the variables that come to mind include these:

    • It's compounded countinuously, and the rate decreases every 250k blocks (~8.7 days). It's 6.99 percent now, but it was 7.41% a year ago and it'll be 6.57% a year from now.
    • Conversion from SBD to STEEM increases current supply and removes collateralized STEEM.
    • If we switch back to SBD printing for author rewards, I guess the current_supply growth will slow but virtual_supply will continue (as collateralized STEEM).
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     2 years ago 

    Thank you for your clarifications. Now it is more clear to me.

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       2 years ago 

      I guess this is the code that does it:

        auto new_steem = ( props.virtual_supply.amount * current_inflation_rate ) / ( int64_t( STEEM_100_PERCENT ) * int64_t( STEEM_BLOCKS_PER_YEAR ) );
  auto content_reward = ( new_steem * props.content_reward_percent ) / STEEM_100_PERCENT;
  if( has_hardfork( STEEM_HARDFORK_0_17__774 ) )
     content_reward = pay_reward_funds( content_reward );
  auto vesting_reward = ( new_steem * props.vesting_reward_percent ) / STEEM_100_PERCENT;
  auto sps_fund = ( new_steem * props.sps_fund_percent ) / STEEM_100_PERCENT;
  auto witness_reward = new_steem - content_reward - vesting_reward - sps_fund;

      So, they create new_steem as a percentage of virtual_supply, and then split that up into content rewards, vesting rewards (interest), SPS funding, and witness rewards.

      The pieces that converts author rewards and SPS funding to SBDs happen a bit later.

      Over the year, then, the virtual steem supply will increase by ~32,689,312 (466990176 * 0.07), and that will be split among VESTS, STEEM, and SBDs. But token burning and SBD -> STEEM conversion can also alter the mix, and it's also effected by the changing price of STEEM.

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       2 years ago 

      Thank you 🙂

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         2 years ago (edited)

        Unless @steemchiller has something in SDS, I'm not aware of any way to get that information from the past. The author of that post used steemsql, but unfortunately steemsql went away during the Witness Wars.

        At this point, the only place I know to get historical supply amounts is here, but that only covers about 2 weeks. So, I could calculate the 2-week interest rate from that fairly easily, but anything longer will take some time.

        This isn't the first time I've missed steemsql.

        Edited to add:

        Based on virtual supply from the link above, the APR over the last two weeks has been (very roughly) about 7%.

        $ perl -e 'print 26 * 100 * ( 466902074.12800002098 - 465653009.56300002337 ) / 465653009.56300002337 . "\n";'
        6.97422287047544

        It's roughly the same based on current supply, too....

        perl -e 'print 26 * 100 * ( 420211866.27100002766 - 419087707.93999999762 ) / 419087707.93999999762 . "\n";'
        6.9742242619498

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