It has been mentionedmerely as a possibility that when MAID is converted to SNToken after launch that each MAID could be exchanged for 6.7 SNToken.
We don’t yet know how the market might react to this and the effect on price but one positive thing we as a community could do is to devote a portion of this larger position to Market Making.
Even the hash graph founder on a podcast was answering to dissatisfied investors that because they don’t participate in market making for “moral” reasons that HBAR doesn’t see the same kind of price appreciation that other coins do.
Without Market Makers there is a lack of liquidity for speculators big and small which means less volatility and less price appreciation. It simply attracts more sophisticated traders and investors. Without a deep pool of liquidity we will never land big fish. Big fish might be big name partners that want to participate in the network, farm, use or provide services but would need that liquidity to feel comfortable they could sell when they needed to. Elon Musk did just this privately with Bitcoin to make sure they could sell without affecting the price.
It’s not all about the money of course. We are clearly here for the world changing technology but price appreciation can help us help the network and the network attract more interest!
AFAIK when you hire out Market Making, you put forth the liquidity you plan on providing (which cumulatively will have to satisfy their amount requirements) and you still own those funds, they trade it across markets to help create price action/supply/demand, and I believe you even earn a small portion of fees. Regardless it ought to have a positive impact on the rest of your holdings.
It’s not set in stone that each MAID will be exchanged for 6.7 SNToken but if it was this would prevent Maidsafe from having to devote further funds to and shortening runway to fully featured network with distributed compute and on and on. It would also be easy to justify for ourselves as it is a position we never would have expected to have and a way to help ensure that SNToken can gain traction.
Of course there are some other details to keep in mind, mainly in my mind, will exchanges ban privacy tokens?
What are your thoughts?
Do you support pushing forward on this as an effort if 1 MAID = 6.7 SNToken?
Would you contribute?
What percentage of your new large bag would you feel comfortable yet generous enough to put forth?
cc @Sotros25
I believe you know a bit about market making. Are there any further insights you could provide?
I personally think that you should leave meat on the bone for people who come to the table later, because otherwise they will not want to sit at your table and go elsewhere…
Emitting extra coins to longterm holders mostly is not experienced positively by the market and it causes the receivers of those extra coins to cash out.
I don’t understand the benefits or justification for issuing all SNT to MAID holders.
I do see it as centralising which is against the goals if not explicitly in the the fundamentals of Safe Network.
I think market making and seeking out “big fish” is in the same category (centralising) and so arguably undesirable. So I’d like us to maximise the number of holders and other stakeholders. Obviously market making could help that too so I’m not saying no.
I also share the wish for MAID/SNT to appreciate in value though, so I’m not against market making or any other marketing and market making activity on ‘moral’ grounds, but I’m not one of those who focus on prices and gains. I’d rather see less rapid rise in price if it meant wider participation (though I’m not saying it would).
If it is purely to get all tokens out there why just not issue more?
My personal opinion is that it is psychologically far better to say that no more coins will be issued than to otherwise seemingly enrich existing holders.
I understand and support the reasoning behind getting all tokens out, not certain the increase is required though.
A friend of mine who is a serious and accomplished investor echoed the same sentiment once: “Never try to get it all. Any serious plan means exiting a position while leaving something on the table for the next guy”.
I will not entrust my SNT to someone else’s care. I’ve been in crypto long enough to see 99 ways this can go wrong.
Uniswap-style liquidity provision is about putting up a pair of coins and if the exchange differs from your ratio, you suffer ‘impermanent losses’. If SAFE works, I expect the exchange rate to continuously improve in favour of SNT therefore I will not commit to any paired liquidity provision.
My plan for providing liquidity is simple. Once SAFE is working and seems to be catching on, I will issue limit orders for 2% of my provision at every 20% increase in price.
Thanks for spurring this discussion, @Nigel! My quick thoughts here are that distributing all SNT to existing MAID holders would lead to an imbalance between supply and demand where holders want to sell many tokens but the market does not want to buy those tokens due to lack of trust and perceived lower value of said tokens.
With regards to market making, this will be crucial both pre and post launch. The first step here is to increase liquidity potential, which requires broader exchange access. Getting listed on additional CEX is something only Maidsafe can spearhead. However, the community can and is helping on the ERC20 MAID front, which can both open up the path to DEX as well as pave the way for ERC20 SNT.
I think there needs to be a thriving market for MAID in order to better facilitate a thriving market for SNT. For me, supporting market making (both for MAID and SNT) is not contingent on receiving more tokens. So long as MAID / SNT is listed on more exchanges and ERC20 MAID is launched, I’d be willing to allocate 10 to 20% of my holdings to support market making. As noted above, however, more liquidity and exchange access is needed now.
I’m skipping the question of market making, and just thought I’d add some thoughts and questions wrt the question of the total supply; where, when and how that shall come into existance.
I’ll now just focus on the - merely possible, but not at all certain - case where the network won’t be able to own or create tokens, and see what alternatives exists then.
I agree that this is a possibility, that a detrimental imbalance (with some undefined longevity) could be introduced.
This is the crux here. How to issue it, and how to distribute it.
Now (as you seem to already know @Josh) the question of letting current holders own it all from start, arose in the first place as one possible way to have full supply without allowing the network to own or create tokens.
My first thought when you suggest “why not just issue more?” (if thinking of an alternative to the network owning and creating), is that Maidsafe would sit on the remaining bag, and release them (in any way, faucets, selling, what ever).
I think this is an even worse situation than the network owning and creating tokens though?
We could possibly make the actual creation of the tokens a one time event, auditable against a genesis of some sort.
But the idea of a single entity sitting on that bag…
As a contrast, with full-supply-to-current-owners, that bag would be dispersed among the community.
How would that ever be hacked?
IMO it’s actually a very decentralised option. And current holders will further disperse those holdings to new hands.
@Sotros25, about that imbalance. Do you think there is any way it could be mitigated/made acceptable?
Maybe the ownership could be set from start, but the release delayed through some sort of puzzle solving.
(It’s not that anyone could solve it, that proposal exists as well, only the owner)
That would prevent the imbalance. Give a gradual release. Disperse the ownership quite broadly. And still disallow any creation of tokens.
Agreed, but that is my point.
I suspect the perception of increasing current holders bags by nearly 7 fold is less favorable than simply sticking to current MAID issuance.
As noted, issuing 7 SNT per MAID is like a stock split, and the fiat value should in theory immediately reflect that (ie divide it by 7). Nobody got richer, its just that all the supply is out there and depends on the willingness of holders to use their tokens or sell them.
The fiat price will depend on three pillars:
the level of farming rewards needed to meet demand for resources
the level of demand for resources
the willingness of holders (initial investors, farmers, traders) to sell at a given fiat price
If supply is drip fed the fiat prices has slow downward pressure.
If supply is distributed at the start, the fiat price drops by a factor of 7 immediately, but the market capitalisation and values of holdings are unchanged.
Another potential issue I expected with a 1 to 6.7 conversion is will it spur a mad dash to grab more MAID now.
Will those buyers be people who currently support the project and are long term holders or will it be speculators wanting to dump at the first opportunity?
I’m not sure it will make much difference. Anyone interested in this can make the same calculation: that all the value is placed in the hands of holders rather than being split between holders and rewards to farmers issued over time. I agree there might be a little reactivity, maybe it gets more attention, but anyone thinking about it will know there’s little difference between a 7x split and the, and sticking with the current MAID issuance.
Why? There’s no reason to do this if it is just a stock split.
Me too, the real issue here for me is about distribution and whether results in higher centralisation which it does appear to do.
