I think they'll have to face it sooner or later. The current policy contradicts itself all over the place. For example look at this...


It's all about how the cake is sliced and stopping coins from hitting exchanges. There is not a single mention of how the chain gets capitalised in the first place. It's assumed. Also, think for a moment about what all this liquidity traffic marshalling ultimately amounts to....an attempt to synthesise scarcity !

So why not just admit it, do it properly and build scarcity right into each block the way everyone else does it ? How does bitcoin get capitalised ? Investors pay miners, miners pay electricity companies and they mediate competition for each block. The more competition there is, the higher the block price. End of story. If you leave 6 of every ten of your blocks out of this race then guess what the market's going to do to your price ?

There are so many signals that this is the wrong policy IMO - inconsistencies in reasoning that don't square or are arbitrary. For example we say we don't need the hashrate, then we say we do need it to be ahead of "certain" competitors. We say we want to reduce circulating supply - so does that mean that high trading volumes are suddenly a bearish sign for Dash when they're generally considered bullish for everyone else ? We say we want to "retain" value in the network by paying less to electricity companies, but then we just pay it to holiday cruise operators instead (metaphorically speaking). We say that new masternodes will hoover up new supply, but masternodes get traded and churn just as the rest of the supply does. So the collateral is not "locked up" it's circulating even though the aggregate nodecount may be static.

We've now given up all gains against bitcoin for the entire year. Support is now resistance. Additionally we seem to be decoupling and are not getting any pumps when bitcoin pumps. The 1-week OBV is only widening to the downside.

A radical review of the reward ratio is needed IMO, one that goes beyond mere orderbook aversion and addresses how to get capital value INTO the chain at a very basic level instead of taking even more out of it. My view is of course that opening up the rest of the blocks to competitive mining would be massively bullish in this respect and arrest the descent, but that's just my view obviously. It needs the community to see it that way for there to be any relevance so there's an argument to be won.

Discord is good for a laugh & chart watching but I've served my time on there. I think this discussion should be exposed as much as possible to the wider market because that's who we need to co-operate if we want to be successful and competitively buoyant again.

I think you'll find that the idea that markets act to eliminate non-performing profit margins is a fairly well established "fact". It's known as the theory of perfect competition and is intuitive to most people.

If you want to make a case for Dash being an exception that benefits from the cited "imperfect competition" in that link, then feel free. I hope it's more inspiring than your grammatical offerings.

Good one because grammatical indulgences is all you've got left to offer our investors.

Shame it's just this thread you can police for "wrongthink" and not the market itself. If you could I'm sure you would. I'd stick to the #pumpIsComing line if I were you.

Indeed. I should of course join the long queue of recruits for your's.

But allow me to hold my breath for a moment more...

Having mining and masternode margins set at anything other than parity is insane IMO and will never allow Dash's capital value to rise.

We can set the Dash protocol reward ratio at whatever we like but it doesn't enable us to rig markets. If we configure our blockchain to issue one coin at one cost base and another at a totally different cost base, all the market will do is act to reconcile those two cost bases. Now ask yourself, what recourse does the market have to do that ?

Only one: the coin price.

Which means that the ENTIRE CHAIN has to be devalued to reconcile masternode margins with mining margins. That is what free markets do. It's why they exist - to eradicate uneconomic profits that benefit neither investors nor consumers nor owners. We have it in our capacity to address this - just use the protocol to reconcile the margins at the point of production. That way the market can comfortably capitalise us at any price. Not only that: we don't lose any of our utility advantage. Margin parity makes Dash monetarily scaleable.

Margin disparity makes us UNscalable (monetarily). So we crash down as soon as the two get out of sync.

Why can't you folks see this simple fact and just work with the market to make ourselves more competitive ?

So we're headed into exchange rate territory with BTC that has not been seen since the dawn of Dash. May I suggest a remedy.

We have nearly half of all our new blocks in reserve = dry powder. They don't get used for anything other than to pay masternodes for doing nothing and the new investors in Dash never see that value because it goes straight to paying the cost of holiday cruises (metaphorically speaking of course ). Even masternodes themselves don't see that value because the cryptocurrency exchange markets simply de-capitalise us as they see fit, so nobody is winning.

We could open up that part of the supply to competitive mining and massively raise the cost base of those blocks. That in turn would raise the tradeable price on the open market and ideally arrest the catastrophic loss of capital value in the chain that we're currently seeing (which I think is unjustified under any economic terms but I can see why the market is doing it. It is trying to tell us something and maybe we should listen).

We may have to consider that we made the wrong decision last year with the protocol change and sent it in the wrong direction. Luckily Dash has a governance mechanism and wrong decisions can be reviewed after a reasonably probationary period, possibly taking a broader range of criteria into account than were considered at the time.

Don't worry about loss of nodes. BTC nodes don't have the chance to make any profit at all. They can't even make a business out of running a node. There will always be takers for a commercially competitive margin no matter what the price of Dash.



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Oh yeah, Rango, that's right. Dashcentral was dead handy for voting. A brilliant system. One of the best things that ever happened to Dash that site.

I dunno. Every time I tried to vote it threw me an error. I mailed (#forgotHisNameThatRunsDashwhale) about it a couple of years back and I think he might have tried something but it didn't work. I did vote on a couple of things though - used the native client, but when it upgraded substantially I needed to do a bit of reconfig and didn't get round to it. (Plus I felt that the proposals were becoming less significant other than the core ones that generally passed anyway).

No. "Roger".

There's no "mixed message". I have an investment in Dash and my motivation is self-preservation and the health of the network in equal measure.

There's no fun in promoting something that you can see has a gaping great economic hole in it. Worse, the market sees it as well. The only people that don't see it are a very small number of holders with more voting power than sense plus one gatekeeping foot soldier on the [ANN Dash] thread.

No. I haven't voted on anything since I lost my ability to do so on Dashcentral, though I could of course have made more effort by doing it manually.

You are free to berate me over that decision and no doubt you'll take full advantage of it. But if you think that justifies your case then I'm afraid you're about get a hard lesson from the market.

Like I say, it thinks it's investing in a monetary asset, not a golf club.

Masternode owners voted for a protocol change which requires the market to devalue the capital value of their holdings to offset the increase in non-performing margins which do not benefit that market's investment prospects.

Being that masternode owners are the largest capital holders on average, it is they that will endure the most financial "pain" from this change. So the metaphor is justified.

I think you'll find this will be the general response outside of masochistic masternode owners and economic analysts who mistakenly project a classic corporate manufacturing model (where excess hashrate would be an unwanted overhead) onto a synthesised monetary asset (where it's essential).

We're not trying to manufacture and sell cheaply secured networks here. We're promoting a store of value and the more expensive it is to mine, the more value can be stored. Simple.

Well we're gonna need it because it sure ain't gonna be "in wealth".

...in poverty.

Charge of the Light Brigade.

Important information for anyone draining the Dash chain of capital value. Possible pump on the cards ?

Do you remember the commentary from last year that we were "wasting money on electricity companies" ? That didn't seem to have been thought through to me because the implication was that if it was spent on masternode margins instead it would be somehow "retained by the network".

But it isn't. It's retained by the pockets of masternode holders who are not "the network". New investors are not buying the capital that sits in MN holders pockets, they're buying into the blockchain scarcity value which is depleted by subsidising uneconomic masternode margins.

So from that perspective the conclusion was exactly the wrong way around. Invested capital from new investors paid to electricity companies (via miners) is RETAINED by the chain. It comes back to us via increased competition for the primary supply. Non-performing masternode margins however do not. That capital value leaves the network altogether.

They don't even necessarily make masternodes more attractive in the marketplace because, while Dash protocol can set the margins, we need the co-operation of the market to determine ROI, since capital gain/loss completes the picture for ROI. If we don't have the capital flows setup right for the market then the reward ratio makes no difference. That's why we need to make capital retention a top priority for the protocol IMO so that:

1. it works as a store of value and then
2. market will endorse masternode ROI through capital gain

#nodesAreNotACharity
#setMarginsAtParity


#cruiseShip --> #tightShip

Up until now, I've been talking about the "primary supply" (new mined supply) and people have responded with the #pumpIsComing theory of capital flows, saying that while I may have the odd valid point, when the "pump comes" it will blow these cobwebs away.

So I thought I'd have a look at the secondary market (exchanges, not mining) and see how absorbent Dash protocol is to rises in price there. But here I see a problem also.

As the coin supply gets absorbed into masternode collateral, it becomes ever less contiguous. What we saw in 2016 & 2017 was the low hanging fruit get put into masternodes, but we will reach a point where it gets exponentially more difficult to find any continuous block of 1000 Dash with the same ownership (or co-operative owners) at which point we've reached "equilibrium: As many masternodes get sold as bought and the nodecount remains constant.

So we MUST consider the protocol in the context of this equilibrium state. It isn't enough to depend on a growing masternode count because at some point (like now) it will hit the limit and at that point we want the capital value in the chain to maintain buoyancy. (Which it can do by directing any mining revenue that isn't absorbed by service provision towards keeping the block scarcity high for the majority of blocks).



Considering a rise in price in the secondary market then (i.e. nothing to do with mining, just new demand at exchanges) we know that that feeds through to mining difficulty to raise the cost of mining a block, and therefore keeps the "opening price" of each new block catching up with the secondary market. For a 100% mined coin, ALL of the money going to primary market is directed at this priority. (i.e. all revenue generated by newly minted coins goes towards raising the difficulty and therefore opening price across all of the chain. No blocks emerge with a zero cost base).



But in Dash it does not. What's supposed to happen is that some of that revenue was to go to finance the service layer, but instead it just goes straight into private hands, not funding either mining difficulty OR services because the masternode reward coins continue to be generated with a cost base of zero.

So we have a TRANSMISSION PROBLEM even in the #pumpIsComing scenario. Exchange demand does not fully feed through to scarcity. Instead it goes to MN profits directly. The way to sort this would be to set the two margins at parity - mining and masternode. That would allow the protocol to:

A. retain capital in the chain without it hemorrgaging out to uneconomic masternode margins

B. absorb far more of the secondary market demand (if and when it comes) as capital gain instead of it being derailed into masternode revenue (and from there, out of the network)



#nodesAreNotACharity
#setMarginsAtParity

But you're not receiving any masternode reward because its bottom line measure is capital gain (due to Dash not being a stable coin). So you should be supporting my reasoned arguments to prioritise capital value over Dash-denominated margins which are meaningless in the event of a capital loss.