If 20% is currently sustainable, then I think it should stay at 20%. Why not? If signs start to suggest it isn't sustainable then let's reduce it. There does need to be a lot of HBD if we ever hope to have it widely used as a stablecoin.

What's your definition of sustainable?

• Sustainable up and until the debt ratio is reached?

This is one way of looking at it.

Another, which is the way I look at it:

• Whether the increased debt burden from idle rewards, is closing the gap on the debt ratio.

The problem with the first definition, is that up until the debt limit is reached, it can be considered 'sustainable' (in the sense the chain will honour the value of HBD in full) at which point, the chain stops paying out the HBD interest to savers and we can say the chain has determined it to be not sustainable. The determining factor is time (all else equal) - the higher the APR, the sooner we reach the debt ratio, the lower, the longer. The only condition where this doesn't apply (and is my preferred definition of sustainability) is when we aren't limited by time, and both are growing, but Hive is growing faster.

However, it also implicitly means that the total HBD market cap is being limited by the market cap of Hive. And by looking at the trends over the past year or so, it is clear that HBD market cap is growing, whilst the Hive market cap is declining.

We have to ask the reason why, and I contend that it is because the relative attractiveness of HIVE/HP vs HBD is no longer balanced.

Therefore, to your secondary point about there being more HBD helping it to be used widely, it would best if the debt ratio was not the limiter. This requires the market cap of Hive to rise atleast as much as the HBD one is.

In other words, it would be better if the market cap of Hive diverged positively from the market cap of HBD, so that the total number of HBD can continue to grow. Its currently converging and has been for a while.

I think reducing post and curation rewards disincentivizes those things, and I'm not sure that is a good idea. The Hive blockchain needs more participation and I think rewarding posting and curating encourages that better than interest on stake. A slight shift could be ok though.

This is a drastic measure and I wouldn't really think it was necessary. I think it was only discussed because if people think that up to 30% of the chain can sit idle and earn more than those actually taking part, then the obvious flow will be towards idle investment.

In addition to reasons already mentioned for buying/holding hive, it also has a vastly larger potential upside than HBD. Its value could easily rise 100% or more. Thats better than 20%.

The problem with this view, is that the duration risk of HP is 13 weeks power down, and the opportunity cost of time is very significant in a highly volatile environment.

Aside from this, I would also rather not leave things to the benevolence of the market. I think we should focus on what is rather than what could happen.

What we thought could happen, was a flywheel set off by the demand for HBD to also propel consistent demand into Hive. We got 7.5M HBD, but went from ~300M market cap for Hive to just over 100M - a pretty large discrepancy.