WEP 4 (rev.1): Block Generation Reward

Author Dmitry Gubanov <dgubanov@wavesplatform.com >
Last update 2019-08-20

UPD:

We have revised the proposal, added governance (remuneration management by WAVES holders), and described the motivation and goals in more detail.

Аbstract

We propose to introduce a reward for the miners that will not depend on the transaction fee. The reward implies the placement of additional WAVES on the blockchain.

Motivation and Purposes

At the moment, a miner receives 60% of the fee for the previous block and 40% of the fee for each transaction that he puts in the microblock.

It is proposed to enter the reward for each created block. The value of the reward does not depend on the number of transactions in the block and the mining account balance (stake).

The priority of the right to create a block is determined by the size of the stake. Since the amount of reward is constant, the miners’ stakes ratio will not change over time.

The current interest rate of a miner is 0.25% per year in WAVES. Once this proposal is implemented, the interest rate of a miner will grow up to 5% per year in WAVES.

Specification

When generating the key block, the system must reward the miner with 4 WAVES. Therefore the total amount of WAVES on the blockchain should increase by the amount of the reward. The amount of reward is not defined finally, it’s chosen to achieve the miner’s annual income of 5%.

The miner should be able to use the received reward at once at his will, i.e. use tokens after the key block.

The miner of the first generated block after the activation of this feature should be rewarded according to the proposed scheme. All subsequent miners should be rewarded with the same amount of 4 WAVES.

Rationale

The approximate amount of WAVES that participate in the mining right now is 40,000,000.

The number of transactions for the period from 11.2018 to 07.2019:

Month Number of transactions
2019-07(incomplete) 1,355,837
2019-06 2,145,453
2019-05 1,809,089
2019-04 1,614,148
2019-03 1,866,636
2019-02 1,788,792
2019-01 1,126,508
2018-11 1,555,044
2018-12 1,433,535

Fees in WAVES for the same period:

Month Total amount of fees in WAVES Average fees/day
2019-07 (incomplete) 7,304 243
2019-06 9,941 331
2019-05 7,732 257
2019-04 5,590 186
2019-03 6,198 206
2019-02 5,747 191
2019-01 4,106 136
2018-12 5,389 179
2018-11 14,794 493

The ratio of the average annual miners’ income to the total stake is equal ~0.25%.

With the introduction of the miners’ reward, the average income will increase to 5%. At the same time, the number of WAVES will increase by 2.1% from 100 million to 102.1.

4 Likes

Didn’t we join waves for it’s fixed amount off waves?

2 Likes

В первую очередь, конечно, хотелось бы выслушать аргументы тех, кто уже давно обдумывал идею перманентной награды за блок и увеличения эмиссии. Наверняка проговаривались все плюсы и минусы подобной реализации. Хотелось бы послушать, чтобы попытаться правильно оценить перспективы принятия такого решения.

Мои текущие мысли по этому поводу:

  • Есть вещи, которые, на первый взгляд, менять нельзя. Вот окончательная стомиллионная эмиссия, одна из них.
    В теории каждый, кто покупал вейвс, думал, что покупает однудесятимиллионную всей эмиссии и это никогда не изменится. Я понимаю, что такой подход не совсем рациональный, (и платформа для WEB 3.0 совсем не про это) но вот ценность Биткоина, во многом, отталкивается от того, что у него есть конечная эмиссия.
    В общем, это психологически как слом одного из столпов платформы - окончательная ограниченная эмиссия. Такие перемены с одной стороны пугают и показывают, что даже в блокчейнах нет ничего постоянного. С другой стороны понятно, что ничто не должно препятстововать прогрессу и развитию. Даже немой публичный договор со всеми покупателями монеты о том, что ее эмиссия не будет превышать 100.000.000

  • В теории больше остальных должны быть обижены холдеры (и будут), хотя на самом деле, если они держат средства в лизинге, их доходность будет превышать инфляцию (грубо говоря).

  • Немного непонятна экономика. В тех чейнах, где есть мастерноды - это чаще всего дорогие высокопроизводительные сервера и награда покрывает расходы. Тут же богатые ноды будут становится еще богаче, без дополнительных затрат. Нету очевидного стимула тратить добытые новые монеты.

  • Понятное дело, что увеличение эмиссии не означает обесценивание токена, инфляция наоборот может развить внутреннюю экономику и ценность, но сам факт таких перемен немного смущает без дополнительного аргументирования (кроме как увеличения доходности майнинга).

При этом в целом я за, при условии, что команда детально продумала экономику. Уверен, что должна была)

5 Likes
  • Yes, I’m agree with inflation idea
  • No, I’d like to stay with 100 million waves amount

0 voters

1 Like

Printing money out of thin air? Sounds like I should go back to fiat then …

4 Likes

I don’t like this proposal at all :worried:

4 Likes

Who is asking for that?

For me you are proposing to break fundamentals of the platform for no big reason.

The current MRT mechanic is centralized, but it really stimulates the decentralization of nodes, because only N first blocks are rewarded. And you’re offering a system worse than the current one.

If you can keep this mechanic which works on decentralization automatically by introducing some formulas or something, not a raw reward per block, it can be interesting. Currently not.

4 Likes

First of all, inflation is a no-go and will never be accepted by a big part of the community and it’s hilarious that you even propose this as a solution to the profitability issues.

The data you are using is quite outdated and was compiled before the activation of 1.0. Since Activation the collected fees are around 1000 Waves per day (which means the whole math in your example is off). Assuming 40 mm total Waves staked this would mean an average annual income of ~0.9%.

I want to mention that this whole proposal is a slippery slope, which I am not willing to go. Focus on adoption and spend the funds you collected during ICO. Stop trying to roll over the costs to Waves holders, because that’s exactly what this proposal does.

4 Likes

Totally against it, if there’s a way to increase the node income that should be by advertising the sh** out of the product and attract more users so to increase network traffic and therefore…the fees.

Adding more Waves is like putting a blindfold and postponing a problem well known since the beginning…

Advertise the platform, advertise it as much as you can, attract people, and you’ll see that the more people, the more fees we’ll get back and miners won’t complain

Just my 2c

5 Likes

True with the statement of @deepred !
Get more transactions and mass adoption , then miners will have more profit after-all :slight_smile:
Don’t upgrade the max amount of Waves !

1 Like

I’m very against adding inflation. If You want to support mining BUY an additional 2 or 4 million Waves from the open market at these prices and add them to the miner rewards!! We choose Waves for not having inflation. Dont make this shitshow even worse than it already is.

Adding inflation is stealingnfrom the community, you are as worse as Central banks.

Best

Johan

5 Likes

I firmly oppose this proposal. It’s literally economic non-sense: whatever additional supply you decide to print and reward the community with through mining is offset by the inflation it creates. The proposal achieves nothing apart from breaking the trust in the fundamental values Waves Platform represents.

The proposal doesn’t even solve a problem; we will have to take the exact same decision again in a year when it runs out. What next? Yeah, right, more money printing.

Big no from me.

3 Likes

My idea was better than this :slight_smile: Waiting all this time and come with this basic idea to make network sustainable :slight_smile: Incentivisation With Inflatıon + Coin Burn [discussion]
Without having a definete incentivisation for miners, the network will never be sustainable and there will be only nodes who just run full node on VPS with low knowledge and expect everything from waves dev team. I am still positive about having inflation in network but also against such a huge about inflation rate. Inflation with low rate and burning fees can provide a good rate incentivisation and also less inflation for waves. The problem I see here is, in any case you have to disable leasing function. Why; 1- You as a waves team, leased too much to the top nodes. They will get much more from the mining, we will lose much more with inflation :slight_smile:
2- Miners will have a good rate of incentivisation no need to worry about getting lease, they can run their own node with their own investment.
3- No need to worry about security, there is smart account to secure their wallet
4- Centralization risk not less than PoS itself, with my opinion if we get less inflation rate the centralization will not be possible for a long time

First, accept disable leasing then let’s start to disscuss best solution. I will never support inflation for some top nodes who supported by waves team with huge amount of leasing.

Edit: thanks for banning me on telegram. Disscuss with ppl who only understand from getting free airdrops.
Edit: One more thing, altcoins losing against BTC but waves losing much more. The price doesn’t matter but waves at 50 rank on CMC. It is definetely bad. Clear the things for future. VST, MRT, mining revenue decentralization … focus on this. If you sold the Vostok project merge the tokens that airdropped to the waves holders with the fund you raised. About 50m VST airdropped for free only with 5-10m usd you can swap it. Don’t create more complex relations for future People invested for one Coin for whole network. If you used same cost rate for VST and Waves on Waves Enterprise chain, the VST holders will complain about it.

1 Like

nope, it was a mistake, you cant grow wıth fıxxed amount as you see sınce 3 years,

1 Like

finaly we have something to get attention from outside miners of crypto world, its good to see that team is listening us, the problem is they are listenign too late,

next step should be to add some btc to that blocks from the fund of waves to boost miners

Practice has shown that the main goal of miners is not return on capital.
Miners keep their nodes to support their projects, and the income from mining is an additional bonus.
If the task is to increase the investor’s demand for Waves, an inflation model is a questionable practice.

I agree that the existing mechanics with MRT proved to be effective. You can increase the income of miners by fixing the buyback price of MRT at a higher level.
This can even be done in the form of smart contrast, quite a decentralized.

2 Likes

Waves tx seem.to be rising and over 300k a day . No need for inflation … just more marketing and building

…All that it will generate is a reshuffling of the existent pool of real savings. It will enrich the early receivers of the new money at the expense of last receivers or no receivers at all. Obviously then, a loose monetary policy which is aimed at boosting consumers’ demand cannot boost real output by a multiple of the initial increase in consumer demand. Not only will easy money policy not lift production, but also on the contrary it will impoverish wealth generators in exactly the same way as the enforcer in our previous example.

You are crazy to create this proposal, it should never, ever have been created!!!

You don’t even know what you are missing for future. Let me explain what will happen with only %2 inflation per year(4 waves each block) also that rate will decrease every year:

  • Sustainability
    Miners will have a definete incentive , that will attract ppl and joining more nodes to the network
    More waves will be locked for staking
    There is a paradox which Sasha mentioned on medium article, with 100m waves without inflation;
  • Paradox : Only way to have revenue for miners is more txs, but when there will be more txs / revenue, ppl will avoid spending waves and will put waves in Stake.
    This is the economy 101. It is nearly some issue with developing countries when they struggle with defining interest rate. which low rate good for spending for citizen and bad for attracting foreign investors.

For ppl who believe that a blockchain project can grove without sustainable incentive, they just leaving in utopia. Like who believe a feeless chain is good :slight_smile:

There are many things mentioned before. let them do best for waves. There is no way than this to make waves great again. :slight_smile: SC, Sidechain all this possible in other chains too. We need something to attract ppl and devs.

V Systems which is copying waves is have 3x marketcap more than waves. Guess why?

  • add fee burn to avoid from high inflation rate (actually %2 is reasonable but ppl will like it with another deflationary factor)