BolehVPN
Well-known member
I understand this has been brought up before but thought I'll put it up here again for discussion.
As I create this thread there are 1303 masternodes. This means 1,303,000 million dark coins locked up out of 4,911,421 drk available. This means more than 26% of darkcoin's economy is locked into coins that are effectively locked out of circulation. With the increase of the masternode reward, this percentage will increase again.
Now I understand that yes, there is the possibility that when masternode hosting is no longer feasible whereby the MN rewards no longer cover hosting (either due to too many MNs or the price of dark coin dropping), logically, people would release the darkcoins out of the master nodes back into the market and try to sell the drk.
But would this really happen?
I host a masternode and in a way it's a sunk cost. I've put in the money, locked it up in a masternode and if drk coin prices falls, I would just keep it running anyway in the hope that drk's price will recover. If masternode rewards drop too, I would most likely still keep it as a masternode as there seems to be little else I can do with drk atm except to generate more drk (with the drk's marketplace now being limited).
To add more pain to this, DRK is NOT easy to acquire and only a handful of exchanges have a decent volume. In fact getting enough for a masternode is not so easy as it is. Mining is also out of the question in generating meaningful amounts of drk. Why people mine drk when it doesn't cover hardware or electricity cost just shows that people are often illogical in the hope that 'one day this will pay off just like BitCoin'. The same goes with master nodes.
My concern is that with the creation of too many masternodes combined with the scarcity of DRK and people mainly acquiring drk to make more masternodes, DRK's value as a currency diminishes especially when we're still in early stages with a limited marketplace and merchant ecosystem and most coins are being hoarded as master nodes. In a way the MN system rewards hoarding even worse than Proof of Stake since with PoS you are not required to hold an arbitrary number of coins to 'mint'.
Just wanting to hear everyone's thoughts on this.
As I create this thread there are 1303 masternodes. This means 1,303,000 million dark coins locked up out of 4,911,421 drk available. This means more than 26% of darkcoin's economy is locked into coins that are effectively locked out of circulation. With the increase of the masternode reward, this percentage will increase again.
Now I understand that yes, there is the possibility that when masternode hosting is no longer feasible whereby the MN rewards no longer cover hosting (either due to too many MNs or the price of dark coin dropping), logically, people would release the darkcoins out of the master nodes back into the market and try to sell the drk.
But would this really happen?
I host a masternode and in a way it's a sunk cost. I've put in the money, locked it up in a masternode and if drk coin prices falls, I would just keep it running anyway in the hope that drk's price will recover. If masternode rewards drop too, I would most likely still keep it as a masternode as there seems to be little else I can do with drk atm except to generate more drk (with the drk's marketplace now being limited).
To add more pain to this, DRK is NOT easy to acquire and only a handful of exchanges have a decent volume. In fact getting enough for a masternode is not so easy as it is. Mining is also out of the question in generating meaningful amounts of drk. Why people mine drk when it doesn't cover hardware or electricity cost just shows that people are often illogical in the hope that 'one day this will pay off just like BitCoin'. The same goes with master nodes.
My concern is that with the creation of too many masternodes combined with the scarcity of DRK and people mainly acquiring drk to make more masternodes, DRK's value as a currency diminishes especially when we're still in early stages with a limited marketplace and merchant ecosystem and most coins are being hoarded as master nodes. In a way the MN system rewards hoarding even worse than Proof of Stake since with PoS you are not required to hold an arbitrary number of coins to 'mint'.
Just wanting to hear everyone's thoughts on this.