Thanks a mill Fez! I was actually listening in live and completely agree with all your thoughts! I think I jumped in here too quick!
Initially I was against the proposal but I’ve definitely swung more on it after more thought. We are a long way off potential deflation coming into play. I think the general concept makes sense but I think the cap should just be adjusted as we go along i.e. hopefully when the ecosystem grows enough a higher cap will be used (right now the funds may sit idle).
Cheers again for the reply and keep up the great content
Hi TJ. Thanks a lot for the reply. Sorry, I think I may have jumped the gun in my prior comment now that I’ve had more time to digest the proposal. We’re a long way off ICX one day potentially being deflationary so my comments aren’t really applicable in the short to mid term!
What you are saying makes sense but I think rather than the cap being completely removed I’d prefer see the cap increased as it’s needed (to avoid any funds sitting idle).
Leaving it the way it is there won’t be enough funding for large project, for BTP incentives or liquidity, for pretty much anything. Caps are 200k each, atm that’s ~$400k which isn’t much in the big picture. Listen to Fez’s podcast and you’ll understand WHY we need a much higher cap or no cap.
The theory that I believe in, is by having a cap and forcing them to fight over ideas to earn the money. I think the current system is good.
Also there’s a difference between abusing a system that it destroys itself, rather than just ‘milking it’… i.e. p-reps can act to keep the network alive, but use cps funds to just milk the system to an extent.
This is why a cap is mandatory. But I do like the idea of burning more than constant small burning. but maybe if we hit 1mill icx, we should burn 20% right away.
However, I believe this topic is masking our eyes from the proper issue @GeoDude
If $400k isn’t enough, why would we hit cap in the first place?
This topic is making us concentrate more on ‘what if the money isn’t used’ to how can we get more money at a faster rate for cps to be used. in simple terms, how can we get more than 300k icx to CPS monthly?
this is the real question and my only answer is to redirect a % of p-rep rewards to cps.
It’s not about hitting cap, it’s about having the funds available. People forget that every project is MONTHS of payments. So if 5 projects get approved for $50k for 5 months, that’s $50k every month going out to them. Then the next month another 5 projects get funded for $50k for 5 months, now it’s $100K every month going to projects. Etc, etc, etc. Also the fact is people keep screaming for marketing, how much do you think marketing costs? It’s not $50k let me tell you that. It’s $200k-$400k for PROPER and PROFESSIONAL marketing.
So you basically are alluding to what I was alluding, in that…
I.e our issue is not that we will hit the cap but we need more ICX coming into cps at a better rate than 300k icx / month. Correct? if so, I agree.
This is an urgent question that is not resolved by altering the cap but rather by increasing the inflow.
Seems to me like the community wants to see how things play out first, which is fine. I’ll continue to think of new improvements the will benefit both the ecosystem as well as investors.
Okay everyone. I just thought up an amazing compromise that I think will appease EVERYONE! (yeah right, can’t please everyone lol). The idea is this. Uncap the CPS fund both bnUSD and ICX, have 50/50 go into each fund (this will support and strengthen bnUSD to start). Wait wait wait don’t start rage typing yet! Here’s the part you’ll love. Every month or 3 months (I don’t care honestly) 25% of the CPS funds will be burnt (after the monthly payouts for bnUSD). This means that if the CPS fund isn’t being used then MORE bnUSD and ICX will be burned. If the CPS fund IS being used then less will be burned but it means that the system is helping fund projects that will bring more value to the ICON ecosystem. So this is a WIN WIN for both sides. Okay, now you can continue your rage typing!
Hi Geo, I don’t think people were rage typing, a difference of opinion is healthy and we are all discussing peacefully.
I like the idea you suggested on having a timing mechanism, rather than a $ICX/bnusd cap, I didn’t quite understand the rest of your proposal.
But I see a problem with the timing mechanism, a vote could just be put in for $1 to keep the treasury overflowing lol. It’s best we all agree on a very specific/detailed mechanism.
Just got around to read through all of the replies. Happy to see that the discussion here is much calmer than some of the twitter posts and threads. Here are my two cents on all of this.
If you try to remove emotional and the psychological factor from it, you will understand that the burn mechanism at this point in time serves little to no purpose aside from ever so slightly reducing inflation - basically a bird hitting the windshield of a moving car and expecting it to stop.
Having a healthy and generous fund is extremely advantageous in the coming phase of ICON’s development. Five years in so far (give or take), and we are still very very early. Icon’s flagship product is just about to launch, and we will need to heavily incentivize its use and adoption.
It is pretty much a fact now that Icon doesn’t have enough eye balls on it at the moment. There is alot more effort being put into outreach whether from the foundation or the community (which is great to see), but this effort is still not enough. As GeoDude pointed out, it is quite expensive to fund a professional marketing effort. The CPS is ideal for something like this because it allows us to put some of the inflation funds to good use such as onboarding new users and developments.
I do not mean to say that a burn mechanism is not important. It is crucial for ICON, but:
In the short term the burned fees would be better off spent on incentivizing BTP, marketing, or funding dapps utilizing BTP and Icon. Incentivizing Icon’s adoption will do much more for the price than a burn in the near future. While yes the “Price goes up = more users” narrative is true, it has a much better chance of happening by having money to spend on network development rather than a few small scale burns.
In the medium to long term, a well thought out burn mechanism with a fixed/ dynamic (inversely proportional) CPF cap can be put in place. As $ICX price goes up, the cap goes down and vice versa ( for example - not even sure if this is possible).
That said, this all too short notice and I can understand why some people don’t want change. I think it is wiser to let things play out for a month or two and then vote to raise or remove the cap altogether and spend the money on much needed developments, initiatives, and contributions which will create exponentially more value than a few burns in the short term.
There are too many articles, so I skimmed through them.
I wonder if the regulation of the icx supply is too dependent on BTP.
CPS is a necessary system.
Only with this can we become self-sufficient. Sufficient CPS funds are required.
With these funds, we can do high-end advertising branding Icon, and we can also bring in promising dApps and developers.
It can also support high-performing dapps.
However, it is not possible to significantly increase CPS funds under the current circumstances. It makes it harder for icx to reach its deflationary goal.
So I suggest. Let’s drastically reduce the icx staking rewards. I still think the icx staking rewards are high.
we can’t get everything.
Let’s reduce icx staking rewards and increase CPS’s funds.
I do not believe that the high staking reward rate will increase the icx price or hold the icx. And it is better for people to frequently engage in economic activities with icx rather than just keep staking. Instead of reducing the staking reward, let’s raise the icx price and return it.
What I want to say is this. (These figures are approximate.) Reduced staking rewards to reduce monthly icx supply from 3 million to 2 million. Increase your cps funds as much as possible. If only reducing the staking reward is not enough, the p-rep reward will also be slightly reduced.
I don’t see any rage typing here. A difference in opinion is healthy and open discussions are something that should be promoted in the community, not hindered with condescending comments
What you’re saying is true, but the premise of the burn only occurs if the CPS funding has not been touched in approx 3 months. It only burns after it’s reached 1m icx, which means the inflation towards the cps has not been productive.
