The problem with changing the inflation rate and supply rate is that it’ll scare off people. How do they know for certain that once you start messing around with the inflation rate you won’t change it again in the future. Look at Ethereum the inflation rate randomly changes at the whim of the development team and that scares off people. Bitcoin’s inflation was known exactly from the start and hasn’t changed on bit since day 1. My fear is that if the inflation is changed people in the future will notice the change and suspect it was made in benefit of the early adopters and what is stopping the inflation rate from changing again. The reason why I hold Bitcoin is because I know with a degree of certainty of what exactly the inflation rate will be and that no one will most likely be ever to change it unlike almost every other form of currency.
If we allow those staking the coin to change the emission rate dynamically (thus leveraging the “wisdom of the crowds”), they would be able to maintain a price that is attractive to both early adopters and new comers, and also benefit the ecosystem. That will come naturally when having “skin in the game”.
A dynamic inflation rate would also make the blockchain “adaptable”, so that there won’t be any need for another hard fork in the future, neither to reduce inflation again, nor to augment the supply.
Also Nimiq won’t be competing with Bitcoin, since it seems that any fixed rate is, or will become eventually, a form of store of value. Which is mostly what the market says when a coin always follows the price of Bitcoin.
Would it affect the way you feel if the new emission curve takes away some of the advantage given to early adopters? The concern I have about the current scheme is that in a few years most of the NIM will be distributed, with not much left to be given as staking rewards for latecomers. Bitcoin’s (and NIM’s) emission curve heavily favours early adopters, and switching to Proof of Stake is likely going to amplify that. I understand and largely agree with what you are saying about the potential loss of trust in the short term, but perhaps in the future people could look at the history of NIM and see an emission change in a positive light if they felt it treated them more fairly? It sounds like the team is close to being ready to present their ideas and findings to the community. I’m excited to see what they propose.
And here is a tool for sharing suggestions for the curve : https://nim.drawpad.org/supply.html
My vote would go for Soft Bound B curve. Not as if I would have any strong reason against Soft A, I just like the 900 NIM/min reward-emission better than the 400.
The value for the “Percent of NIM circulation staked” is basically a guess, right? Or do you have actual data or tendency from the market, from other currencies?
Preliminary, I’d say that somewhat between the proposed curves looks ideal, weight to the bottom curve
Judging that it’s pointed that first milestone to look at is 25 years emission, and the difference in propsed curves is 15M vs 12M (roughly 25%)
My rough suggestion would be 525 NIM/minute and 1.47% yearly decrease.
Illustration by Chugwig’s website: https://nim.drawpad.org/supply.html?perMin=525&decrease=1.47
With this approach we would make a big initial inflation decrease but a bigger staking reward for future stakers (less steep decline). This seems fair for initial investors and longterm holders, as well as for future members.
- In the supply curve vote it is not clear to me if the NIM of the address or of the whole account are counted. Say, I wanted to vote with all my NIM - would I have to send NIM from each address if I have several in the account? The voting message says that the NIM of the address are counted.
- We should consider a lower and upper NIM limit cap for voting- this would reduce dilution of the wisdom of the crowds from voting by people with little economic interest on the one side and of whales on the other.
- A vote should be included for when the supply curve is to be re-evaluated and revoted on, as this would give more adaptive flexiblity to a very hard to predict evolution of the NIM project.
Hello waldmeister.
I can only answer question 1 for you. What matters is the address you have voted with and not the total sum of an account. So if you would have 1 account with 2 addresses (X and Y), only the NIMs are counted from the address you have voted with (address X). If you want to let your second address count as well (address Y), you have to vote again and select your second address.
Thank you Stefan- I thought so, thanks for clarifying!
Hi Waldmeister!
on 2) if you read the blog post, the team evaluated hard and soft boundaries for the curves to be voted on if first vote passes by voting “yes”
- This is an interesting question, perhaps @Richy can discuss with the team and give us a reply.
I personally feel that this isn’t needed, as we are able to adjust to curve due to a hardfork network transition which is likely an event we shall see once.
I don’t like the idea of reviewing the curve personally, it makes it difficult for someone to invest their finances into NIM over competing currencies in my view. I also think it would cause unnecessary hardforks to happen.
Hey Rob,
ref 2- great thanks for writing and clarifying, I hadn’t realized… 
With one day left to vote it looks like the emission curve change is going to happen. Timing it with a major protocol/consensus mechanism upgrade makes it easier to justify to critics. It also doesn’t really affect scarcity since the supply cap remains in place; it just moves the scarcity around in time.
But the more I think about it, the more I agree with Sandman that these kinds of changes can damage trust in the currency. If the team has decided that the total supply cap is going to remain in place, and will be reached at the same point time as before, perhaps there is a way to build that into the code so that it can’t be changed until after the final block? I can see people making the argument that the supply cap is meaningless if this kind of thing can be voted on or changed by the team. If that is not possible, then some sort of statement about which circumstances would need to be in place for the supply cap to be changed in the future would go a long way in maintaining trust.
Honestly, I don’t see how changes to the supply curve or the supply cap could be either prevented or enforced by the team or any other centralized authority. With an open source permission-less decentralized blockchain things like forks come with the territory. That’s why voting for a supply curve change is taking place with the largest accounts holding NIM having a say in proportion to their balance.
Perhaps the team was considering adjusting the curve internally, but on public there were no such discussions. A change for the supply curve or at least evaluating it came from the community. I was one of the early members who started this topic if i’m not mistaken.
Surely, until the rollout of 2.0 the project is in the hands of TN, but after the hardfork I imagine more devs joining in to the open source field. The team picking up this topic, making a well-thought evaluation and giving the community the choice by voting on it for me is a good step between “open-source” and “team nimiq decides what they want to do”.
Again, the fact that the transition to POS & 2.0 requires a hardfork is the main reason we have the supply curve vote. Since mainnet launch time has passed, lessons are learned and for POS we might need a different tokenomics policy.
I appreciate the opportunity to give thought, share opinions and vote for what I consider best for long-term success. You need to adapt to become the best.
You’ve been more active than I have in the past 12 months or so, very good chance I’m misremembering this, but the entire reason why we’re currently voting on the curves as a community is because of the fact that the team proposed to changed the curve without proper consultation with the community. I know I was very vocal in saying that I disapproved of the curve just being changed by the Team without a community vote for example.
It’s difficult to recall telegram conversations that took place long time ago (I found myself talking about it in early October). Unless it was internal, we had talks about price, inflation and adjusting the curve before it came from team Nimiq. I may be corrected, but my perspective is that the community started this topic and discussed during months and team nimiq picked it up afterwards.
We know the team had consulted with financial advisor who suggested to mark boundaries and general do’s and dont’s. Afterwards TN compiled an excel for anyone on the community to play with values and evaluate the curves. One of my proposals was actually taken what is suggested as “blue” curve. So in my perspective the team did listen to community & give tools to work with.
I don’t disagree with the team listening to the community in recent times re: changing the curve, I just don’t think I agree with the whole “the curve was being changed because the community wanted it to” part. I know there were informal discussions on Telegram/Discord about it, but I think the primary driver of that came from the team itself.
The discussion about inflation crippling NIM in the current market (both in terms of price and usecase) has been around ever since the release. I remember Richy told us about potentially adjusting the curve around August of last year.
If your question is whether the team would have proposed a vote if they did NOT want to change the curve then I guess we will never know. 
The thing is that there is no organization around Nimiq other than Team Nimiq itself.
It’s a nebula of individuals so at what point can you say the “community wants X”? When 1 guy is asking? 2? 10? (Maybe this is something to explore btw, the “Syndicate of Nimiq Veterans?” 
).
Overall my impression is that the community follows the guys and trust their judgement as long as things are explained transparently.
Still in this precise case I think having a vote was the best scenario, deciding unilaterally to change the curve and telling people to fork off if they weren’t happy would have been pretty terrible in every aspects.
Hopefully this shows the team they don’t have to be scared from actively consulting the community in the future when it comes to governance too.