- The vote for addresses that have more ATOM staked, do they not carry more weight than those accounts with less ATOM staked?
- If such a feature were implemented, would this not be detrimental to other chain’s tokens who participate in share security (i.e trade/sell pressure)?
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- I don’t understand your point. Whoever has more ATOMs has more voting power. That is how it works here. I don’t think you have proposed anything different.
- Converting rewards to USDC (cash) or ATOM or keeping the investment is up to each individual investor based on their investment strategy. I don’t understand what your issue is. The point is you will get paid. You get paid with tokens. If you want these tokens to turn to cash, they can. If you want them to turn to ATOM, they can. As far as voting,
if you keep the tokens → you increase your voting power in those protocols,
if you convert to USDC → you lose voting power and
if you swap to ATOM → you increase your ATOM voting power.
Makes sense to me.
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Correct. If less and less ATOM is being brought into the world, this over some given period of time will drive the price of ATOM up (good thing). This will make ATOM less accessible the more expensive ATOM becomes (bad thing). Lets say ATOM stays above $20 bucks in the future. It would cost individuals more to gain voting power. This isn’t a problem for a whale or someone who is already well off who can buy expensive ATOM. However, this becomes a huge problem for most individuals. It inevitability would centralized the voting power of The Cosmos Hub. Does that make sense?
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Just because I am getting paid in a bunch of different tokens doesn’t mean it will equal what I would have gotten rewarded in ATOM. I stake ATOM for the voting power AND the cash value proposition. With your logic, you are wanting stakers to choose between having voting power or having cash value.
Right now, we don’t have to choose as we still get plenty of ATOM. With this proposal, it will one day make voting a centralized affair. Take the power from the masses, they will revolt - in this case, selling off and making whales more powerful. The Cosmos Hub governance would become meaningless.
Change my mind.
This is where we apply the Scarlet O’Hara principle of “I’ll think about it tomorrow”. I think we are very far from these scenarios and when we get there we’ll figure it out.
Fair enough.
I am still open to having my mind changed.
As the proposal stands, I will be voting “no”.
A “yes” vote from me will be a minimum inflation somewhere between 2.5%-4%.
Personally don’t think now is the time for this. I was for 848, but for now, if we do adjust the minimum, would feel more comfortable with 5, if at all.
Edit: would also like to see how the Blockworks proposals are received by the community next (?) month when they’re brought up for voting.
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The more people delegate, the more the % bonding is going up so the more vote there is
Having it at 0% means there is enough incentive with consumer chains or just because of the political aspect of the Hub, which means we would have reach the goal.
Having a minimum above 0 means we already fail at providing/building well the narrative and the economic linked to it
What’s the specific point of 5?
- Not an economical choice
- Not a narrative choice
You make a point on the money side of things.
While I can see present day we already have to make a choice between value proposition vs voting power (hold your ATOM vs sell your ATOM), I can’t see how bringing less ATOM and or zero ATOM into the world is healthy for the voting power economy of The Cosmos Hub.
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Reaching 0% staking yield in $ATOM would mean 100% of $ATOM would be staked, so I guess it would be ok! (Reaching this case would mean consumer chains would be very, very profitable for the Hub)
What would be the unhealthy part for the voting power economy if 100% of $ATOM where delegated? (would never happen anyway)
What would be the unhealthy part for the voting power economy if 100% of $ATOM where delegated?
Yes, this is highly unlikely. The unhealthy part to the voting power economy would be the conflict of interest we are currently dealing with. While everyone who has bags of ATOM wants to see price go up, ATOM is also our governance token.
- Less ATOM coming into the world, price go up.
- Less ATOM on the market trading, price go up.
- [additional utility cases for ATOM to rise in price not listed here]
The concern is The Cosmos Hub will become centralized due to the barrier of entry to acquire ATOM. If it cost a premium to get ATOM due to the increased price, only whales or those who are well off will be able to accumulate the asset at a rapid rate. The chain would be decided and controlled by a few. We would be no better than the following at that point:
- BTC being centralized/controlled by a few large mining companies.
- ETH being centralized/controlled by a few large stake pools.
- SOL being centralized/controlled by a handful of VCs.
As contentious as the prior vote of moving the max inflation rate down to 10% was, it was our governance system working. This isn’t to say our governance system is perfect and couldn’t use some improvements, but it by no means is what I would call broken.
As the price of ATOM rises due to these tokenomic changes, our governance system will become centralized as a result. I would have no problem with this if we created a separate governance token that stayed at a manageable price (suppressing the price - the conflict of interest) to keep The Cosmos Hub decentralized.
Let me know if I have any massive oversights in my observations above.
If the minimum inflation is at 0%, it will scare the validator away, doesn’t it? It will be a too much risk for them to run a node.
@ThePowerCosmic You have this backwards. Inflation is not making the Hub decentralized. Exactly the opposite - high inflation is making the Hub CENTRALIZED. That’s the explicit intent of high inflation according to Jae - the Cosmos Hub creator - put more ATOMs in the hands of the stakers and dilute the ATOM holdings in the hands of non-stakers. That’s why he wanted to have 20% max inflation - to dilute non-stakers faster. That is CENTRALIZING behavior away from non-stakers. I think implicit in the Jae thinking is that non-staked ATOM is the one held on exchange pools to facilitate conversions to fiat. The more ATOMs were held on exchanges for active trading, the more the inflation would increase to dilute the exchange held stake. So a high inflation would continuously prevent those exchange pools from growing in percentage terms and taking control of the Cosmos Hub. That’s still the case, we just limited the extent of that to 10% per year instead of 20% per year.
Reminder again, the ATOM issued by inflation goes ONLY TO STAKERS. Even though let’s say 20% of new ATOM is issued it goes ONLY to the 65% who staked it. Inflation on its own absent a redistributive fiscal policy doesn’t improve decentralization.
I am sorry to be so blunt, but your whole argument is non-sensical.
You are thinking along the lines of “One man, one vote” governance, but that doesn’t work in blockchain systems where accounts are anonymous. Let’s say you have a guy with 10 ATOMs in his account and obviously today he has 10 times as much voting power as another guy with 1 ATOM. Now you change governance rules where the guy with 1 ATOM has the same voting power as the guy with 10ATOMs. Well… the guy with 10ATOMs can then create 10 accounts with 1 ATOM and again have 10 times as much voting power. A script can be created to do that and shared online and then everybody will end up doing it. In fact, some people are complaining that bot voting behavior is already employed (thousands of sub 1 ATOM accounts voting quickly at the start of Prop 848). The reason why voting in blockchains is stake based is because account identities are anonymous. That’s the whole point of blockchains - you can’t have decentralization without anonymity.
I need somebody to address this issue for me because I can’t figure it out.
Coin Gecko and Coin Market Cap show different market cap number for ATOM and have different circulating supplies. Coin Gecko shows 292 million (which is the same as the one shown in Mintscan) and as such shows $2.8 billion market cap and 30th place in the ranking. Coin Market Cap shows 377 million circulating supply which the same as the TOTAL supply of tokens shown on Mintscan and as such shows $3.5 billion market cap and 22nd place in the rankings.
That is a big difference.
This is also important for the calculation of the bonded ratio. 247 million is bonded. If the circulating supply is 292 million, then bonded ratio is 84% and ATOM is very much very secure. If the circulating supply is 377 million, then bonded ratio is 65% which is what we see on Minstscan.
How can Minstscan simultaneously show 292 million circulating supply and 65% bonded ratio? It doesn’t make sense.
There is 85 million ATOM discrepancy between CMC and CG. What are these 85 million ATOM? Who holds them? Why are they included in the bonding ratio by Mintscan? If they are not part of the circulating supply, how can they be acquired in an attack?
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@vixcontango ,
My concern isn’t about high inflation (max inflation), my concern is about little to no inflation (min inflation) - the purpose of this thread.
You are thinking along the lines of “One man, one vote” governance, but that doesn’t work in blockchain systems where accounts are anonymous.
No, I am thinking about weighted voting. Your example of 1 man - 1 vote and blockchain anonymity is correct, it doesn’t work without some type of digital id system. Please reread my concern about the ability to acquire more ATOM above due to the premium price of ATOM in the future (i.e. my ability to acquire more ATOM than the next voter so my vote will OUTWEIGH their vote).
My suggestion of a separate governance token was merely to not go against what we are trying to achieve with ATOM (increasing its utility and price). If this is the future of ATOM (it having a price premium), we really need to be concerned with the centralization of voting.
lol. sometimes i have this feeling too. I have defo seen people just create opposite posts for the sake of it =)
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OK. Let’s say you have a fixed price governance token. What’s stopping someone with lots of money from buying out all of them? Also more fundamentally, why should people without economic stake in the network have governance power over it? Voting is fundamentally centralized into the people who understand the network and its issues and who care enough about it to accumulate economic stake in it. For what reason should people who don’t know about the network, don’t care about the network have a very low barrier to entry to be capable of exercising governance power over it? What is that accomplishing?
Let’s say you have a fixed price governance token.
I never suggested having a fixed price governance token.
Also more fundamentally, why should people without economic stake in the network have governance power over it?
I never said they should.
For what reason should people who don’t know about the network, don’t care about the network have a very low barrier to entry to be capable of exercising governance power over it? What is that accomplishing?
Sounds like we are talking about two different audiences. My concern are those who are interested in the Cosmos Ecosystem (specifically The Cosmos Hub) and who want to have a voice. If the purpose/idea of a blockchain ecosystem is to remain decentralized, by raising the price of ATOM significantly, this will centralize The Cosmos Hub governance.
The concept of blockchain decentralization is technical and refers to “fault tolerance”. You can’t attack any one node, or a collection of nodes and take the network down. There is a measure called Nakamoto coefficient and ATOM’s is 8 which is middle of the road. It’s decentralized enough.
How do you define governance “centralization”? What is your measure? As far as I am concerned, ATOM suffers from governance “centralization” because account holders delegate voting to their validators and don’t vote themselves. ATOM is more than decentralized enough in terms of account ownership, but the fact that account holders don’t vote is the primary reason for governance centralizing into the hands of the validators. ATOM price is not the issue.
If anyone wants to vote in the Cosmos Hub, they can go buy a full ATOM or partial ATOM and that gives them the right to vote. There are thousands of sub 1 ATOM accounts that voted on Prop 848. So I am not sure exactly what you want to do? Give penny accounts higher voting rights? Do you want to implement quadratic voting to reduce the vote of big accounts? I am trying to understand your objective.
The concept of blockchain decentralization is technical and refers to “fault tolerance”. You can’t attack any one node, or a collection of nodes and take the network down. There is a measure called Nakamoto coefficient and ATOM’s is 8 which is middle of the road. It’s decentralized enough.
I wasn’t speaking about decentralization from an attack, I am talking about decentralization from a few speaking for the masses.
How do you define governance “centralization”? What is your measure? As far as I am concerned, ATOM suffers from governance “centralization” because account holders delegate voting to their validators and don’t vote themselves. ATOM is more than decentralized enough in terms of account ownership, but the fact that account holders don’t vote is the primary reason for governance centralizing into the hands of the validators. ATOM price is not the issue.
I did say earlier our governance system could use some improvements and is not perfect.
If anyone wants to vote in the Cosmos Hub, they can go buy a full ATOM or partial ATOM and that gives them the right to vote. There are thousands of sub 1 ATOM accounts that voted on Prop 848. So I am not sure exactly what you want to do? Give penny accounts higher voting rights? Do you want to implement quadratic voting to reduce the vote of big accounts? I am trying to understand your objective.
I don’t have an objective, I am just making an observation. You just admitted that governance right now is rather centralized. I ask you the question, less ATOM coming into the world, higher price of ATOM, will that centralize governance more or less?