[bisq-network/proposals] Distribute trade fee in BTC to DAO stakeholders by using locked up BSQ (#316)

chimp1984 notifications at github.com
Fri Mar 5 03:20:25 CET 2021


Yes, its hard to predict the economic consequences. 
The locked up BSQ are not available in the supply, so it is not only the issued vs. burned BSQ but:
- issued and available on the market (e.g. contributors selling earned BSQ)
- issued but locked up BSQ (e.g. contributors prefer to receive BTC fees)
- burned BSQ from traders using BSQ as trade fee

I think the inflation/deflation balance did not cause much impact on the BSQ price. We only increased BSQ by about 19%. 3.6M BSQ at genesis, now 4.3M BSQ. This over a (soon) 2 years period (about 29k/month). I think those are low operational costs. But it seems that did not have much impact on the BSQ price (e.g. did not create incentive to buy BSQ).

But the main goal of that proposal is not to change the economic incentives for BSQ, but to partially fix the burningman problem as well as reduce the impact of high miner fees on trade fee districbution.

The BSQ stakeholder do not have time pressure to consolidate those small utxos, so they can act more economically than the burningman who is expected to consolidate/trade at least once a month. With current high fee rates I guess 20-50% of the fees is lost on minerfees. Also the BTC/BSQ trades will eat up a chunk of the fees.

The bigger problem of course that trading will become too expensive with those high miner fees is another topic. And will be the main influence about the BSQ price as well as Bisq's future. Until new models are found a focus on higher trade amounts payment methods might mitigate the issue. Also XMR market can help, for large trades the miner fee is not that relevant.

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