Do both options 1k% and 2k% APY include the same bond capacity or does it differ as well? Which one would be better for the treasury and for stakers in the current market situation?
KIP 14: Resilience Mode
10000% AGREE!!! every 10 days somebody is dumping on us, somebody changing the rules! Now all is going fine, we have a strong HODLER base, no sell offs, new buyers coming in. what the hell again is your problem?? you want to destroy all good and kill this project????
in two weeks, o sorry, we need 10% APY, you not understand whats going on?? many investors NEED high APY coz they buyed high!! we need a hodl base, not so many "experts"! now we have a hodl base, all goint good, leave it as it is!!
KingArthur33 rip the bandaid off and go with the 1k APY People always want to get rich now. People don’t understand lowering inflation will help the price. Let’s take klima back to 500.00 bucks with 1k APY!!
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Sir, please read the messages above on how high APY is irrelevant to growth of investment. Neither is the price.
High APY --> Increased supply of KLIMA --> Reduced runway --> Bad for KLIMA protocol long term health.
For now, let's assume we've a good runway. Let's compare
Your KLIMA: 10
Supply: 1mil KLIMA
Price: $100
Current Market Cap: $100m (Supply x Price)
Investment value: $1000 (# of KLIMA x Price)
Target Market Cap: $10b (in 1 yr)
APY: 10,000%
Your KLIMA: 1000 (approx) - 100X
Supply: 100mil KLIMA - 100X
Current Market Cap: $10b (set target)
Price: $100 ( Price = Market Cap / Supply)
Investment Value = $100 x 1000 = $100,000
Alternative: (for the same $10b market cap in 1 yr)
APY: 1,000%
Your KLIMA: 100 (approx) - 10X
Supply: 10mil KLIMA - 10X
Current Market Cap: $10b (set target)
Price: $1000 ( Price = Market Cap / Supply)
Investment Value = $1000 x 100 = $100,000
In both cases, your investment value has grown from $1000 to $100,000. But if the APY is 10,000%, the protocol has increased the supply to 100mil KLIMA instead of only 10mil KLIMA. This dilution would reduce the runway over those 12 months.
The key is market cap. For the same market cap, KLIMA will have a higher price for reduced supply (reduced APY).
Lower APY --> reduced KLIMA emissions --> Slower rate of supply of KLIMA --> Increased runway --> Better for protocol --> Better control over bonding metrics --> Controlled treasury growth
Love this KIP, a step in the right direction and getting closer to fixing the broken supply/demand dynamics of Klima that has been crashing its price.
Would love if you could share your actual spreadsheets and models around this, including how this impacts projected future supply. A lot of us are actively modelling this and some of the parameters are a bit hard to dig out.
For example:
What is the actual bonding rate? Eg how many Klima are issued via bonds right now vs the different proposals?
How will this affect supply growth of Klima? (Bonding + rebase)
How will this impact the ability to fund the team. Remember in KIP10 I believe there was a very short team runway, wont this reduce the funds flowing to the treasury that we can allocate to the team?
Cudos to the team for putting this together and again think this is a great proposal, in favor of 1k APY or lower until Klima supply dynamics are more favorable.
I really want to introduce one point. Typically with policy in most fiscal scenarios, gradual changes are better. Though, the dynamics may perhaps be different in what we are doing. So, my only point is, how gradual or how sudden will change protocol parameters to 1000%? Should we as policymakers consider a gradual decline; or a sudden decline in rate reduction? Just points to consider. It's never positive to be drastic in economics. Let's change the policy rate; until times are more favorable to a point where it makes sense to increase the klima token supply. I'm sure we will be back up in less than a year.
Further, in the meanwhile, the various teams should consider how to encourage onboarding more carbon projects. How do we enhance the network effect of the various contemporaneous protocols C3, goddess, Toucan---How do we encourage them to encourage more companies to begin contemplating putting their offsets on-chain?
Sepeth Reward rate reductions will likely take place over several days in intervals.
Hey guyse,
I have lost about 18k here,i buy at 2900$ i have invest more and more (dca) if you reduce apy at 1000% why should i stay here? why not go to olymbus with same APY and more ''safe''? or time with 10 times biger apy?
If someone answere me with legit facts i stay, other way, BB.
- Edited
This article is sort of interesting - https://hristovbz.medium.com/voluntary-carbon-markets-a-primer-61ff20bf34fa
But to keep the thread on topic, I am also 100% behind APY reduction while the refi market catches up. Ensuring the long-term health of the protocol to do massive, transformative change doesn't sound like a bad idea to me.
mastoras00733 Please check out comment #56
https://forum.klimadao.finance/d/29-kip-14-resilience-mode/56
As an investor, look at your investment growth, not APY rate. It's a misunderstanding that high APY means, more KLIMAs, means higher investment growth. More APY means, more supply of KLIMA. Supply goes up, price goes down, for the same marketcap.
Think of lowering the APY, as equivalent of burning KLIMAs than originally projected. This is a +ve thing.
APY does not matter. What matters is Treasury Growth and Market Cap growth.
Ok understood.
But 7000% to 1000% is to tragic.
Lets go to 50% then.(??)
My proposal is to reduce Apy step by step.
6000 - 5000 - 4000 -3000 and see what happens.
Or just leave it there as it is let the price go 3$ to see what happens.
Move 7k straight to 1k its a panic move. Wen the price go little bit up many people will move funds to OHM or Time or whatever.
We can't have same apy with OHM so fast
GM
A step by step approach is rational. This is not.
andybash12
Realy now?
You make calculation "1000$ klima" as example?
What makes you sure Klima price will go up after reduction instead of going down?
But anyway you may have right.( I hope)
Lets see what happens