The current power down rules allow users to power down their STEEM at a rate of 1/13 per week. The first payment is made 7 days after the power down is started.
What if users want to power down faster than that? What if someone wants to cash out 100% of their SP today?
There is a cost to the network for allowing users to power down quickly:
- Large dumps can cause dramatic price drops.
- Users could double vote for content if they receive their liquid STEEM within the 7 day voting window.
It is in the network's best interest to have slow power downs, but it is not in the best interest of individual investors. Individual investors would like to be able to power down quickly.
What if we could setup a system that benefits both parties?
We could do this by burning a portion of the STEEM if users want to power down faster than the normal rate. This would give the individual investors the liquidity they want, and it would benefit the network by reducing the supply of STEEM.
| First Payment Delay | Number of Payments | Cost |
|---|---|---|
| 7 Days | 13 | 0 |
| 7 Days | 4 | 15% STEEM Burned |
| 7 Days | 1 | 25% STEEM Burned |
| 0 Days | 1 | 50% STEEM Burned |
This could be really beneficial if there is a huge price spike, and users want to take advantage of the high STEEM price. It can also help unhappy participants exit the network quickly, without needing to stick around for 13 weeks.
By decreasing the amount of STEEM coins in existence each time this occurrs, the value of STEEM would increase due to decreased supply.
Thoughts?