Inflation of 6.5 %

The yearly inflation rate of Hive is around 6.5 %, that extra Hive is distributed through posting rewards, curation rewards, witness rewards and staking rewards. That is the normal inflation, and this inflation slowly goes down in the upcoming years, so less and less Hive is created.

But in the last 7 years, the supply of Hive has gone X2.5. Which is a lot, this is a period in which a lot of extra Hive has been created, as it is in the early stages of the inflation cycle. We have gone from around 200 million Hive to 500 million Hive today, circulating. Not all of that is staked, not even half of it.

Now, there has to be an incentive to be active on the chain, or to be a witness, so inflation is really necessary. But the question is, hasn't the inflation been to high the last 7 years, creating a too big sell side on the supply and demand curve?

The future is bright

Now, if that is so, or not, is a very hard question too ask, but if you ask me, I think the inflation curve should have been a bit less steep the last 7 years. The upside of that is that in the future, inflation will fall quite fast. For 2024 the projected inflation rate is around 6 %, for 2025 it will be near 5.5 %. So new Hive will become scarcer and scarcer.

This all put together shows me that in the upcoming years Hive will thrive. When it comes to active users, because of the efforts of the Leofinance team. And price wise, because of the nifty inflation curve that is built in.
We have been through the rough part, the best years are coming now!

Graphs for this I got from one of @dalz posts about the inflation and evolution of Hive, which are always very interesting to read.

Sincerely,

Pele23

Posted Using LeoFinance Alpha