How SPI makes $$$ from EDS
Hello SPIers, today we look at EDS and im going to show you how this small project will be a huge part of SPI someday. I dont often write about EDS from this account but each week in the weekly report, our total HP balance decreases and most weeks I'll mention it is because of EDS. Im assuming you know a little about EDS already if you are reading this post so we can skip basic things.
Today im going to show you why EDS loses HP every week, how we're going to reverse this and how EDS is guaranteed to have at least 500k HP by the time it has all 500k EDS tokens in circulation which is important because each EDS token is backed with 1 HIVE.
Its not BS, read on and see for yourself
Before we get started here, just an FYI. Im 70% done writing a complete everything about EDS post where EDS, EDS miners, @eds-vote and EDSD tokens are all explained in 1 place and how they all feed into EDS to get us to the end goal faster. EDS is on a set road, getting to the finish line is just a time thing. It might be a week are 2 before I upload the post from the @eddie-earner account. I've mostly only graphics to do. These take a long time cause i like to play 🤣
Why does EDS lose HP every week?
The short answer is, EDS mints tokens faster than we power up HIVE to back it. When we sold EDS miners, we collected lots of HIVE much faster than we minted EDS and this gave us a huge surplus of HP to be used to back EDS tokens created from EDS miners. When we sold out of EDS miners, the HIVE stopped coming in and now we use that surplus of HP to back any EDS tokens over what we powerup each week from HIVE incomes.
Currently EDS mints more EDS tokens than it powers up HIVE so this eats into the @eddie-earner HP balance each week and is the reason why we have a decreasing HP balance.
At its peak when EDS miners sold out, EDS was losing around 200 HP per week from its balance. At that time, we were bringing in 335 in income, paying out 234 of that as the weekly HIVE income payment and powering up the remaining 103 HIVE. We were minting 290 EDS a week so the 103 HIVE that was powered up backed 103 EDS and then the remaining 187 EDS were backed from the HP surplus in the @eddie-earner wallet.
Currently, 1 year on, EDS is losing only 50 HIVE a week from its balance. It is bringing in 640 HIVE a week from incomes, paying out 257 HIVE of that as the HIVE income payment and then powering up the remaining 380 HIVE. We mint around 430 EDS a week now so the 380 HIVE we power up backs 380 EDS and we back the reaming 50 from the EDS surplus HP balance.
How will this reverse?
We getting really close to a point where EDS will be powering up more HIVE than it needs to back newly minted EDS tokens. This is an EDS profit flip but not the EDS APY flip. I cant explain the difference in under 500 words but I thought I'd just make to make you aware that EDS becoming profitable does not mean the EDS APY flip will happen at the same time. It's very good, a huge step forward and part of the progress but they are not the same thing.
I should mention here that 65% of minted EDS tokens each week come from EDS miners and EDS miners are set to mint a certain amount of EDS each day. 30% are minted from @eds-vote and the remaining 5% from @eds-d. EDS-vote and EDSD both power up 2 HIVE for each EDS they mint, Remember this because it's important for later.
The bulk (65%) of EDS mintage is a set number which will not increase/decrease for 18-19 years. The remaining (35%) are minted at double peg price so no worries there. The @eddie-earner HP balance which currently has growth of over 15% per year will continue to increase and compound its HP balance and this will result in more HIVE income. After much time, the HIVE income will overtake what is needed to back newly minted EDS tokens because EDS mintage is almost a set number. This is how EDS will reverse. EDS mintage flatlines at 400-450 each week for the next 20 years while HIVE income from its evergrowing HP balance grows and grows.
Getting to a 500k HP balance before EDS 500k hardcap
Making sure that each and every EDS is backed with 1 HIVE/HP is rule 1 for EDS, even more important than HIVE income 😲
In a nutshell...
- We have 110k HP in the @eddie-earner wallet now (110k)
- We currently powering up 20k HIVE per year
- We have 120k EDS allocated to @eds-vote which are effectively minted at 2 HIVE each. When eds-vote has spent its EDS allocation, it will have powered up 240k HIVE to @eddie-earner (350k)
- We have 60k EDS allocated to @eds-d which are also effectively minted at 2 HIVE each. When eds-d has spent its EDS allocation, it will have powered up 120k HIVE to @eddie-earner (470k)
- We power up 20k per year and it's taking at least 10 years for eds-vote and eds-d to issue their allocations. We will power up at least 200k HP in 10 years keeping in mind, we earn a little more each week. In 10 years, EDS could power up 300k+ HIVE but we'll say 200k. (670k)
There you have it, EDS should have around 670k HP in 10 years if it can issue its eds-vote and EDS-D allocations. Im going to say these are conservative numbers as well because compounding works really well over 10 years. By the time the last EDS miner rewards go out, there could be 1 million HP in the account with SPI owning the surplus 500k HIVE.
So now to can see how EDS cant really fail based on its current distribution plan. Neat?
What does EDS do for SPI?
Nothing really, props up the SPI token price mostly 🤣. SPI owns EDS, which means it owns the surplus HP balance but we can not use it because it is required to back new EDS tokens. Even after EDS income is higher than token mintage and the HP balance is increasing, the HP balance in @eddie-earner is required to base the weekly HIVE income pool from so we cant touch it. For SPI, the surplus HP balance is a paper asset. The only time SPI gets that HP balance is when SPinvest wraps up shop and everything is all powered down.
When we boil it down, EDS is a paper profit for SPI. SPI owns the HP surplus but cant do anything with it. Here's a thought...
Maybe we could even sell EDS someday to another operator or group of operators. When all EDS are hardcapped in 20 years and we have at least 1 million HP, we could be powering up 160k HIVE per year (13% leo.voter + 3% HP inflation) at minimum. An operator could slip 80k a year and keep it going with 6-8% income growth per year. If sold at a low P/E ratio of 3 for both 160k and 80k per year and we factor in the 500k surplus of HP on top of the amount of EDS (500k hardcap) being backed, EDS would be worth 680k-980k HIVE. Granted, 500k of that would be in untouchable HP and after that most of the profit and payback for the new operator would be in the form of HP they also cant get touch until EDS is wrapped up which can not be for at least 10 years after the last EDS miner is issued (im making up terms now). It could be a thing, in 20 years HIVE could be massive with tens of billions flowing through it each day.
It could be possible for this to happen, a few years back I searched HE projects, dead projects that were operating and just dead to see about buying them over and putting them in the SPinvest Umbrella but there was nothing good. EDS has the infrastructure, a solid community and a proven model that yields results which would make EDS worth taking over compared to starting a new HIVE income token and competing.
Maybe my head is up my ass and im just daydreaming again. But it would be cool to be like, GUYS, just sold EDS for a millski HIVE and this week's SPI divided pool is 100k HIVE as a 1 off.
Anyway, let me know what you think about that. about what if we could sell off EDS someday. How would you value it? I look forward to seeing how people answer this.
Recap
So thats the post. I hope now you understand EDS a little better and a few things have now clicked for you. EDS is a very simple project but I understand not all SPI token holders are involved with EDS and even the ones that are can not see every post or remember what they read 2 years back. I'll release a massive 3000-5000 word post will some cool explainer pictures from the @eddie-earner account in a few weeks.
Have a great rest of your day YO!
| Token Name | Main Account | Link to hive-engine |
|---|---|---|
| SPI token | @spinvest | SPI |
| LBI token | @lbi-token | LBI |
| Top XV token | @spinvest | XV |
| Eddie Earners | @eddie-earner | EDS |
| EDS miners | @eddie-earner | EDSM |
| EDS mini miners | @eddie-earner | EDSMM |
| DAB | @dailydab | DAB |
| DBOND | @dailydab | DBOND |
Stay up to date with investments, and fund stats and find out more about SPinvest in our discord server
sickkk post here!!
i just read half of it, when i have more time ill reread everything but so interesting 👌
being the proud owner of over 20% of the mining power of EDS, thats so useful to know
Your such a pleb. You can listen to posts these days.
Glad you liked the post are the half you've read so far. I like writing about EDS, there's no downside or risk really so its always just good news.
If you like this, you'll like the one to be uploaded from @eddie-earner 10x more
I like Numbers and I like this post!
I'm not sure about that selling the EDS project. But if I read it right, we still have more than 20 years to think about that :D
This was a fun post to write, me like numbers as well
Yea, we have 20 years to think about selling EDS. God knows in what state the world will be in by that time, haha
Well, selling EDS is a risk that I hadn't considered when investing in the token.
What guarantees would there be with a different operator?
But anyway, why would SPI sell it if in 20 years there could be billions flowing through Hive? Wouldn't SPI want to benefit rather than handing it to someone else?
It is something that only crossed my mind when writing this. Dont think we could ever sell off EDS, maybe if SPinvest had to wrap up someday, could be worth more to us to try and sell it on.
As far as guarantees, im not sure. I'd like for it to always put at least 50% of its income back into HP to ensure growth year on year. That would be important but once a sell is done, we have no control over what a new operator would do.
Interesting to think about all the same.
Very good @spinvest / SSUK.
Yes, well, nice lighthearted brush off, but I know it is very time-intensive to generate these posts, with all that goes into them. And I very much appreciate the effort!
Sounds good.
This one? Bookmarked, for future reference.