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.
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