We have seen the future.
Sometimes things can be so obvious it slaps us in the face. My view is that history will look back on the hard fork which instilled resource credit delegation as a monumental moment, even those we didn't notice it at the time.
Hive is a unique animal. Not only are there two coins on the base layer, we also have one being an access token. Many blockchains have transaction fees yet, on Hive, an investment is required (by someone) to transact.
Here is an example of someone who posted yesterday.
Notice how this individual lost the ability to interact with the blockchain. While we can acknowledge it is just one person, this can be extrapolated out.
Hive offers something very valuable. We hear a lot about NFTs and how they can be tied to digital assets that can skyrocket in price. Taken this view, if we strip it down, Hive is digital real estate.
This means that anyone who wants to interact requires resource credits.
Network Effect And Increased Numbers
What makes real estate valuable?
Mostly this comes down to supply and demand. People wonder why real estate prices in major cities (and the surrounding areas) have skyrocketed. The answer lies in something called urbanization. In the United States, along with most other developed countries, the flight has been from rural areas to urban. The decline in manufacturing jobs only heightened this.
Hive is no different. What makes Hive valuable is the demand for access to the real estate. Unlike digital collectibles which utilize an NFT, Hive simply has the $HIVE coin. This is fungible but does give everyone a portion of the blockchain, especially when powered up.
As we can see, without it, there is no way to gain entry.
This is rather different from the common design of most networks. On Bitcoin, as an example, to transact one simply has to pay the transaction fee. This means getting some BTC and spending it to engage in a medium of exchange. This can be a one off event depending upon what the individual is doing.
With Hive it is completely different. The individual is required to make some type of investment into the ecosystem to transact. Simply buying the coin to pay a fee doesn't work. It has to be staked to impact the on-chain activity.
Here is where the network effect will hopefully enter. There was a time where we have hundreds of thousands of users who were active in some form. This fell off during the previous bear market which was painful. We also had the Justin Sun episode in the middle which further fractured things.
Nevertheless, the solution is fairly clear. Increased numbers due to game or applications that excite people cures a lot of ills. Here we see the demand for $HIVE enter as resource credits are needed. At the moment, the ratio is heavily tilted to an abundance of RCs versus demand.
This is the situation that the community has to focus upon.
Applications Bear The Responsibility
Hive is going to be driven by the applications. What is built upon the blockchain will determine how the future unfolds. If projects are highly successful, kicking off the network effect by pulling in more users, we can see how the numbers shift rather quickly.
Applications are going to need to have their users engage. There is no way around this. An application or game is useless if people are not able to interact. If it is tied to Hive, on any level, it will require resource credits.
As the above image shows, any on-chain activity has a "cost" to it. Of course, the fact that RCs regenerate at a rate of 20% of the total, per day, is helpful.
What happens if Hive is able to get 100 million transactions per day? That sounds like a lot but it really isn't when you think about it. Consider all the activity tied to:
On Hive, each of these is a transaction. The daily total for all these entities is in the trillions. Therefore, we are talking about a small fraction of the global total. In fact, 100 million transactions on Hive doesn't even make a dent in what is taking place just in social media.
Hive Is Different
The resource credit system is rather unique. It separates Hive from most of what is out there. We discuss the potential of the Hive Backed Dollar (HBD) and how much of an impact this can make. Here again we see the same concept forming: RCs are required to engage using HBD. This means each transaction is tied to an investment in the "digital real estate".
Of course, we can push this out even more into the financial realm when we start to consider more financial products such as bonds, swaps, and futures. All of this could be constructed and tied to Hive.
In the end, the future of an access token is fairly clear. Just get the numbers up and the rest takes care of itself.
It is really nothing more than supply and demand.
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