Proof of Stake Reward DiscussionRecently a number of people have expressed concerns about the current proof of stake interest rate which they feel is too high. As we have changes that will require a hard fork anyway this seems like an opportune moment to discuss whether or not it should be changed.
We'll assume that if we burn all MOIN unclaimed from the swap on 9th May there will be around 6.2m remaining:
Current MOIN supply: 9,320,303 MOIN
Already burned:381651.062629597 MOINEstimated unclaimed MOIN to be burned:3,000,000 MOIN
Estimated usable supply at swap's completion:~ 6,200,000 MOIN (say roughly 200,000 MOIN from stake interest between now and then)
The figures are necessarily inexact but should be accurate enough for the purposes of this discussion.
Expansion of MOIN supply with current PoS interest rates:
This would see us reaching the 21m maximum supply between the 35th and 36th year.
Proof Of Stake v3The crux of people's concerns seems to be that the current scheme is skewed too heavily towards rewarding early adopters. Monetary inflation's a complicated matter and it's not made any easier by the fact that many of the arguments re ideal inflation rates for fiat currencies aren't applicable to cryptocurrencies. An inflation rate of 2% has been suggested. I'd also like to suggest that we move from PoS v2 to PoS v3. The main difference is that coin age would be removed from the equation, meaning people could no longer stake every few months and receive rewards roughly commensurate with what they would have gotten for staking continuously. With PoS v3 (assuming an inflation rate or 2%) each block would have a static stake reward in the beginning of roughly 0.25 MOIN + fees. It incentivizes continuous staking which for obvious reasons benefits the network.
Expansion of MOIN supply with PoS v3 and 2% inflation of current supply:
With this scheme we'd reach the maximum supply of 21m between the 61st and 62nd year.
My own feelings on the matter are that the reward scheme of PoS v3, by rightly rewarding those continuously running full nodes, is such an improvement over the previous scheme that it alone warrants the change. The point of the generous early interest rate was to encourage a healthy network even in the project's infancy, but I think PoS v3 does this much more effectively. I don't have any strong feelings with regard to the static interest rate - 2% seems fine but I'd be interested to hear what everyone else thinks.
So what do you think? Should the current scheme change? Should we move to PoS v3 with static rewards and if so is 2% a reasonable rate for inflation of the supply? I'd be grateful to know what you all think and if you could answer at your earliest convenience. Once we've reached an agreement we can put the finishing touches to the updated road-map and press ahead, which I'm eager to do.
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