Do you want to predict the supply of Hive-Engine tokens?
Yesterday @jongolson got a comment on one of his posts that was asking about a transparency report for the CTP token. Since I'm quite into all this tokenomics, he asked me if I could have a look at it and try to come up with such a transparency report.
I'm always eager to make some research and to learn more about how things are working. What I discovered actually blew me away...
Finding the data and understanding it
The first task at hand was to find the correct scot settings for the token. For that I went through the initial posts when the token was launched. Unfortunately there was always a link to the settings to a page called scot.today. Unfortunately this page seems no longer to be online. I then went through peakd posts related to scot settings. Well I didn't find much but I didn't want to give up. I was sure that there would be a kind of api with a link where to retrieve this information.
The next step of my research was to go through the token information on hive-engine. I was sure that somewhere someone would put a link to their token settings. I was lucky and I found exactly what I was looking for on the page of the LIST token. This was the link that I found:
https://scot-api.steem-engine.com/config?token=LIST, now I just had to transform it to
https://scot-api.hive-engine.com/config?token=CTP to find the settings for the CTP token. If you paste this link into the browser address bar, you will get all the scot settings for the CTP token.
Some interesting data about the CTP token
When you look at this data, you are still a big step away from actually understanding it. It took me quite some time and some back engineering to figure things out. Here some important things that I manage to find out about CTP the token:
- Every day, a total of 3992 CTP tokens are issued
- 3393 of these tokens are distributed to posts (85%)
- 599 tokens are distributed to miners (15%)
- Every hour 20 CTPM holders get 1.2474 CTP token miner rewards
- Every year the number of CTP tokens issued is reduced by 1%
Once you understand this, you can actually define how the token supply will evolve in the future:
| Date | Total supply | Increase % |
|---|---|---|
| 02.08.19 | 695'000 | - |
| 02.08.20 | 2'166'822 | +67% |
| 02.08.21 | 3'623'785 | +40% |
| 02.08.22 | 5'066'179 | +28% |
| 02.08.23 | 6'494'148 | +21% |
| 02.08.24 | 7'907'838 | +17% |
| 02.08.25 | 9'307'391 | +15% |
I started on 2.8.2019 because this was the moment when the token was launched and there was also an airdrop that I had to factor in.
When you see how the supply evolves, you realize that the total supply will increase at a slower pace in the future. If the token grows at a rate of around 40% this year, next year it will be growing only at a rate of 28%.
What does this mean for the CTP token?
It will get harder and harder to earn CTP tokens in the future. With more people buying and earning the token, the supply will be more widely distributed and for each token holder, it will be more difficult to grow his stake.
Each token has slightly different settings and it's interesting to compare them. If you look for example at the leo token, the supply is reduced every year by 7%. This means that the number of tokens emitted will be diminishing much faster than for the CTP token.
Understanding the settings of a token will help you for your investment decisions
If you understand how the supply of a token will evolve, you have one of the basic information for investment decisions. In addition to that, to predict the price of a token you need at least to know the following aspects:
- Burn rate of a token
- Stake rate of a token
- Development of the demand
Of course it's only one aspect of the whole analysis but I believe it's one of the most important ones.
Let's connect ! You can find me on these platforms:
Posted Using LeoFinance Beta
Wow! It will be just 9 million token till 2025 but wait.. Do we need High inflation to onboard more people?
Posted Using LeoFinance Beta
The number of CTP tokens is actually growing in a linear way (minus 1% per year) when you compare it with the existing supply, this means that the growth is getting slower and slower. After 2025, the supply will quickly drop below 10%. This doesn't take into account the burn rate of the token that can reduce this inflation.
!ENGAGE 20
ENGAGEtokens.I didn't now the Leo supply will diminish so fast, that's pretty cool. It's 7% of the remaining supply or the initial supply ?
Posted Using LeoFinance Beta
Actually for LEO there are 19 LEO distributed every 100 blocks (5 minutes). Every year this amount will diminuish by 7% in regard to the previous year.
!ENGAGE 20
thanks for the reply, I love learning new things about Leo :)
Posted Using LeoFinance Beta
ENGAGEtokens.Outstanding work Achim! Fascinating information.
Thanks a lot. I had quite to do some research but it was an eyeopener for me. I really start to understand how things are working :-).
!ENGAGE 20
ENGAGEtokens.Thank you!
Posted using Dapplr
I'm not competent in terms of tokenomics but I follow the burn rate and stake rate aspects of the tokens before investing. So far, it all looks so good for onboarding ^^
Posted Using LeoFinance Beta
It's probably not the easiest field of study lol. I believe that it's good to understand how a token supply is evolving to evaluate the potential of it. Thanks a lot for stopping by!
!ENGAGE 20
ENGAGEtokens.Very interesting. Let's stack up those tokens now before they become harder to get!
Posted Using LeoFinance Beta
That's exactly what I would suggest :-). Thanks for stopping by!
!ENGAGE 20
ENGAGEtokens.You have put up a good effort in digging up all these information!
CTP looks good to me but I've doubts about the distribution strategy for CTPM. What does your analysis for the miner token indicate? It would be really interesting to know.
When going through these numbers I realised that the miners of a token are working in competition with each other. Every hour 20 Miners are rewarded for CTP. For Leo it's 30 Miners. I believe that Miners are especially good at the very beginning when a token is emitted. The more miners are staked, the more difficult it gets to actually get some rewards. Thanks a lot for stopping by!
!ENGAGE 20
Yeah, but I was pointing towards the inflation in circulating supply of miner tokens as it has a large total supply which contributes to periodic increase in circulating supply by distribution of new miner tokens through sales by the team. More staked miner tokens are diluting the rewards for existing stakers of miner tokens. Am I getting that right?
That's quite true. The more miners in circulation, the more difficult to get rewards.
ENGAGEtokens.I am amazed at how you track this kind of stuff down. I am thankful, though, that you did. Since I am contemplating creating my own token, it is nice to be able to see how other tokens are set up and how they work. I appreciate your diligence in researching this data and presenting it here. It gives me a starting point for how to start my own research in this area.
It was quite a lot of work to first get the information and then later understand what it actually means. There are actually quite a lot of dimensions that can be set with these hive-engine tokens. There is a lot of flexibility possible. It's also interesting to compare the different tokens and see what is different among them.
!ENGAGE 20
ENGAGEtokens.let's make the ctp token moons in 2021!
Posted Using LeoFinance Beta
The road seems paved to go there :-)
!ENGAGE 20
ENGAGEtoday.