I feel like a deeper discussion is required around the implication of Staking as income. The United states, Canada, and Japan considers staking rewards as ordinary income when received. The fair market value at the time of receipt is included in assessable income. Later disposal of these assets may trigger capital gains tax. Sweden, Portugal, Germany and the UK also bare forward costs, meaning “income tax” as some level must be paid in the previous year. Findings from a paper have discovered that due to vesting shedules, artifically high taxation rates are applying to those “staking”.
Titled “Dilution and True Economic Gain From Cryptocurrency Block Rewards”, this paper details that on the tezo’s network inflation of 7.14% on average resulted in only a true economic gain of 2.04%. This means people need to dispose of their assets at a faster rate inorder to fulfill their tax obligations than the acutal value of the crypto itself. Therefore, inflation is counter to adoption - especially ordinary users in which I hope you are targeting. Volitility to the upside results in the same concequences. Solana CEO talked about this with Laura Shin a few months back also.
Bottom line is governments are leaching and you have no say. Kamala Harris was talking about unrealised gains on those with 20m over…the Australian Labour Party is about to implement unrealised gains on Super over 3m. This trend is not going away.
2 Likes
Hi Steve, thanks for your comments, but to be honest I’m struggling to understand whether you’re in favor of this change or not.
1 Like
Yes, a poll sounds great!
2 Likes
Minting supply causes sell pressures on both holders (as they need to pay tax as accessible income), further, on validators who sell because they are in profit. A negative feedback loop. The negative feedback loop compounds the effect. You want users. And speculation drives users. And price drives speculation. The dead weight needs to be shaken. The reason BTC is successful is because there is a true cost in the aqusition of coins (hardware and power sets baseline). And all I know out of direct experience, you are PVP with governments. Frankly, going from 5% to 4% by 2030 is a joke. And I will be dead by 2055. 2% should be brought forward to 2030. 7m units on the sell side now to 13c. Nearly 7x increase from 1 year. Your accumulation and distribution (A/D) is appauling. Stochasitc RSI is about to turn down hard. And you need to make bottom statement asap. This is not drastic enough. You are all nerding out over acumen and diplomacy instead of telling each other how it is. You all need to stop beating around the bush and fucking spiders. Honestly, the proposal needs rethinking. It needs to be way more radical. My market heat map for BTC and ETH using 12 indicators is at 102/120. The market might not be here in 1 year. There are over 40m coins now, when back in 2017 there was 322. Bull markets are few and far between and you need to stand out soon. I have poured over $0.5m into this… meanwhile KR1 and hypersphere have nothing on the books. Go hard or go home. Or most will leave.
1 Like
Hey everyone,
This has been a fruitful discussion!
Per @legendnodes request, I’m creating this poll:
Due to the expected change in Moonbeam inflation model (assuming passing vote) - do you think the active set size should be reduced accordingly?
- Yes, I think it should be reduced to 74 seats
- Yes, I think it should be reduced to 72 seats (like in Moonriver)
- No, I think we shouldn’t make any change now and reconsider it in the future
1 Like
I have voted to not decrease the size of the active set. This vote is based on the many, many times over the years in Moonbeam and Moonriver when there has been a situation when the set has become contended.
The network particpants who were typically most effected were a) community collators, which have not had the capital to acquire more GLMR to maintain an active position when compared to non-community collators (e.g., how many times have we seen Cosmoon collator fall out of the set during times of contention?) and b) stakers that lose rewards during the leap frog competition, and eventually need to switch when a collator decides to stop fighting for a position.
Additionally, it felt like there was an equilibrium at 76 collators, and it would be better to change one parameter at a time and measure, vs making multiple changes at once.
3 Likes
I also personally think we should leave the active set the same for now and just deal with the one issue atm.
2 Likes
Hi everyone, in the following days I’ll post a referendum to change Moonbeam inflation model to linear according to the discussion here.
Regarding the set reduction - we’ll discuss it in the future (based on the pool above).
Thanks everyone for your participation in this important topic!
4 Likes
Thanks again to you dear Rafael for having triggered such a fruitful discussion with so big engagement and commitment, very much appreciated!!!
3 Likes