Why No LEO Payment For Premium
It seems that some people are upset about the premium payment only being done using the HBD. Many feel that $LEO should included, if for no other reason than to provide utility to that token.
Believe it or not, this was the mindset that I first encountered when discussing this topic.
So why not include LEO in the payments? There is a valid reason for it which we will go through in this article.
Cryptocurrency Is Misleading
We all know the word cryptocurrency. This is one of the most misleading terms in the world. What we are dealing with is not currency, While it can serve in that capacity, it doesn't do it very well.
Most cryptocurrencies are really crypto-assets. They are no different than any speculation device. They go up or down based upon market activity. In fact, we even use a term that describes that: market capitalization.
What is the market capitalization of Apple? Amazon? Microsoft? You can look at that. What is the market capitalization of the euro? Ask that to 100 investors and they will laugh at you. Who heard of such a thing?
Yet, isn't that what we do in crypto. We try to take a speculative asset and turn it into a medium of exchange. Is it any wonder things are having issues?
What is LEO?
Most crypto fails as a medium of exchange because of volatility. If an asset is volatile, it is crap in this role. For those who need an example, take a look at the Turkish lira and see how merchants are dealing with that.
Price stability is crucial. That is why stablecoins are popular. They serve as the mechanism for payments. This is where HBD fit.
LEO does not.
Instead, LEO is a value capture token. This is designed to encompass the value created on this ecosystem. The goal over time is for the price of it to move up in line with the value generated. When it comes to medium of exchange, the goal is the opposite. The ideal there is for it to never move off its peg.
Degradation of LEO
Using a crypto-asset as a payment mechanism sends the wrong message.
Do you really want a project team telling you that they are doing work to build value, but get rid of your token to make payments? Think about that for a second. If the value of the token is going to be greater in the future, why would you want to part with it? Even worse, do you want the project team to tell you to do that?
It quickly becomes clear the message: get rid of this thing in return for the service provided.
To me, that is an easy way to degrade your token. Again, is it any surprise we have seen poor results overall throughout the industry.
The key is not to build utility for LEO. Instead, the goal is to build value. Simply because it can operate as a medium of exchange does not make it ideally suited for that.
For example, I could pay a bookie with my car if it avoids having my legs broken. By doing so, that does not make automobiles are great payment mechanism.
Why do people claim they want utility added to the token? So the price goes up.
Do you see how counterintuitive this all is?
HBD: Medium of Exchange
HBD is the medium of exchange within the Hive ecosystem. Leo is doing a great service in general by offering another use case for that coin. Hopefully by doing so, it opens up the door to even more value being generated within Leo. That is what will be captured by the token.
Warren Buffett said the best stock to buy is the one that you never want to sell. With tokens, it is the same thing. We want to build value in the token so that the wealth grows. This is an asset that can serve that purpose.
Perhaps, down the road, we will see the asset used as collateral for loans. That is a fabulous way to access the value that is captured. How would that be paid? In HBD would be the best option.
HBD operates as a medium of exchange, thus acting like a currency. LEO, on the other hand, is a crypto-asset. The goal of all who are involved in it should be to get the value to appreciate over time. Here is where wealth is generated.
We do not accomplish that by trying to add utility to it. After all, what is the utility of Apple stock?
Posted Using InLeo Alpha
Using a stable coin makes sense over tokens. If anything I'd add in USDC and USDT. I'd rather a stablecoin when buying things I don't feel like I'm giving up huge stacks of LEO which would most likely set me off to not get it.
I see this makes sense why it's in HBD. what about if you use LEO you can purchase a subscription $8 and let $2 of Leo gets burned. Let people burn Leo supply! let's gooooooooooo
Why do people believe in burning money. That is the dumbest thing ever.
o.o that would be in fiat where more can be printed but I think leo already has a set supply right. we also do burn leo with the ads i thought theres a buy back or something
LEO isnt like a currency. It is more like a stock. Simply because the name says cryptocurrency doesnt mean it operates like one.
But it does operate like a currency though. I think this is the first time I'm not on the same page as you taskmaster. If you want to enlighten me on you thoughts please do
My car can be used to pay a debt but it doesmt make it a good medium of exchange. LEO is a value capture. People want price to go up. If that is the case, it is awful as a medium of exchange. To fill that role, it requires price stability.
o.o but isnt that the case for any crypto. they want the price to go up i mean if we not counting stables
Yes and that why most crypto are really crypto assets and not currency. When prices go up, they can also go down i.e. volatility. That sucks for payments. Look at the Turkish lira to see how a fluctuation currency is awful for pricing of goods and services.
It is why Bitcoin is being misrepresented. That is ill suited for payments overall.
hmm when you say it like this it makes sense. O.O thanks for enlightening me taskmaster. this is why you are the genius
How can I get full access on an account created in leo using email to sign up
@khaleelkazi or @anomadsoul
Can you answer this one?
Check the wallet page in about 48 hours on https://labs.inleo.io
OK thanks for the information , I got some users I need to onboard but they need clarity on claiming accounts
I also had this question in mind too because the last time I remember we were told that we would use leo tokens and maybe hbd to get the premium of inleo but now I'm seeing it's all hbd.
Now that I've heard the reason why hbd is better, it makes it sound even better and promising. Using HBD as the mode of payment for inleo premium will send a strong message of what a Blockchain hive is and that will not only help the inleo community but all the communities on hive.
Like you said, with time we will find a much more better way to put the leo token to good use and with that in mind, I'd just keep staking as many as I can.
It provides utility to HBD while also maintaining the message that LEO will be much more valuable down the road and to stack it.
It's definitely the best choice for payment 😊
Hbd is no doubt a better option. Your explanation on value capture says it all. Leo doesn't have to be used. In fact that will create more pressure on the token instead of growing it. Because at a time like this when Leo is low in price that means you'll have to dump a chunk of them to pay for something in USD.
Oh this explanation was needed and now I get why we shouldn't pay Leo tokens for the subscription.
Thanks for clearing this up 🙌
Thanks for clearing up this confusionn as your explanation makes a lot of sense out of this.
This line of thinking is where I started to come around on the idea
Building payment rails where we can bring an outside currency (something with liquidity and low-to-no volatility) that is then used to purchase the asset (LEO in this case) is a much better capturing of value.
I think the big pushback on this idea is that people are earning LEO on the platform (although they also earn HBD, but in much lower quantities) and they see the LEO they earn as a great way to "get premium for free"
While we would love it if everything were free and easy, that's not the way value is captured. We need to capture value by other means and then bring that value back into the token. Accepting HBD-only is a great way to do that
I also think the pooling of the bought LEO-HIVE is going to prove to be an incredibly valuable move in the long-run. We are building permanent liquidity that goes in only one direction (up). Liquidity is essential for both HIVE and for LEO on DEXes and as we look to integrate to chains like Thorchain for both HIVE & LEO, this will become a vital center for trading.
It's time to build all of the payment rails and get value captured back into the LEO token.
These will be the first 3 of many to come. We need to keep growing them
Without a doubt. The idea of using LEO as a payment token (or medium of exchange) diminishing the value from a psychological perspective.
With all the developer, there is no reason to take the approach that LEO will not be a $1-$3 token at some point. So why are going you going to spend $10 worth of LEO today which could equate to $500 per month down the road?
That makes no sense and is bad for the team to instill that idea. Now, there is no problem for the team to assert it intends to build a great deal more value on the token and holding is a good idea.
Congruence is vital.
Plus you are right. The permanent liquidity if crucial. We need to be able to easily handle the individual who wants $50K worth of $LEO. Now, getting $5K is a nightmare.
Removing utility from a token is not exactly creating value.
The fact that they don´t accept LEO sends a hidden signal. They are out for your hard (pegged) cash (HBD) and not for a hyperinflationary token which they are anyway sitting on.
Interesting way to look at crypto (as an asset that continues to grow in value over time.). Thanks for the new perspective.