[GIP-16] Implement a deflationary mechanism to burn 10% of UBI sent daily

Governance Proposals
#1

GIP: 16
Title: Implement a deflationary mechanism to burn 10% of UBI sent daily
Author: Cesar Cordero
Status: Stage 1
Track: Meta/Tokenomics
Created: 2023-10-19

Summary:
Burn 10% of UBI sent daily, decreasing the total supply.

Description:
Implement a deflationary mechanism to burn 10% of UBI sent daily, decreasing the total supply. For example, today G$ sent 3M G$ as UBI for all claimers, then we will burn 300,000 G$ today. It could raise the price and create interest from big exchanges. All big crypto projects burn some of their coins.

6 Likes
[GIP-15] Burn Unused Good
#2

I agree, what should be done to put it to a vote?
🫸🫷

2 Likes
#3

First of all I just wanted to suggest a name change for the GIP since there already exists one with the same name.

Second, I think it is good not to mix this proposal with Oliver’s proposal [[GIP-15] Burn Unused Good - #8 by oliver75montes] which essentially has one idea different.

And now, I will leave my personal thoughts unrelated to my responsibility as a moderator. I have never been a fan of token burning, but with Gooddollar I am particularly less in favor of token burning, because I consider it a way of taking away from people part of their basic income is fundamentally one of the main reasons.
I also have my opinion with the burning, in my opinion they are used only for speculative purposes that do not have a certainty that “the price can rise with the burning.”
It is literally throwing money into the basket, the money of the claimers.

I think there could be a point that could be positive.
It would ensure that the reserve had more liquidity when selling G$. Currently the reserve is designed to have liquidity until the last second so it does not seem like enough benefit to me.

1 Like
#4

Thanks Andrés, for participating in this discussion. What I see, is extremely difficult to rise the price of G$ having too much coins in the market: 2,000,000,000,000 G$. The marketcap of BTC is 500,000,000,000 USD. None crypto in market will surpass BTC by rule. So G$, in current situation won’t get to 1 USD per G$.

Too much offer less demand, low prices. Low offer higher demand, high prices. We have to low the offer and it will make it valuable, so the demand will grow up.

It’s my opinion. But it’s ok to listen and read other opinions.

#5

Time to vote? @goodanna @pedrosa.eth

#6

I think the decisssion should be taken by the Community in a votation.

#7

Hi Cesar! Thank you for your participation again, the proposal must be discussed for at least a some days, doing everything possible to listen to the community. In your case, you created the proposal from stage 1 since it begins as a sketch. You can progressively adjust the stage based on the idea. let it form (I suppose that’s why you started it at 1 to put it together closely with the community) Then I will start sharing your proposal encouraging participation. It should eventually be released if you are consistent in keeping it afloat by solving and building it.

If you need some guidance, the moderators should always be there to guide the process of presenting the proposal so that we believe it has a greater chance of being approved. regardless of our judgment on the matter (obviously as long as it is not some type of proposal that seeks to exploit the gooddollar protocol in some way.

Remember that it is necessary for the proposal to receive the approval of the moderators before being launched (regarding the discussion time, clarity of the proposal and format of the proposal). I am really happy that more and more proposals are coming out on GoodDao.

#8

I just think that Btc can be more of 150k so…
Is not a financial advice, just my opinion.
And gooddollar can be used in all the world that’s more liquidity liquidity that’s a lot of liquidity.

Actually gooddollar is on more of 180 countrys
Wishing the best for Gooddollar :raised_hands:

#9

Thank you very much!.

#10

After a future wide discussion on the Community, I would be open to change some characteristics of the proposal, not 10%, maybe less.

I have taken the idea from Ton Coin, and made some changes:

#11

Modification of proposal.

GIP: 16
Title: Implement a deflationary mechanism to burn 10% of UBI sent daily
Author: Cesar Cordero
Status: Stage 2
Track: Meta/Tokenomics
Created: 2023-10-19

Summary:
Burn 10% of UBI sent daily, decreasing the total supply.

Description:
Implement a deflationary mechanism to burn 10% of UBI sent daily, decreasing the total supply. For example, today G$ sent 3M G$ as UBI for all claimers, then we will burn 300,000 G$ today. It could raise the price and create interest from big exchanges. All big crypto projects burn some of their coins.

#12

I don’t know how to burn G$ sent to users. This proposal means that we should reduce G$ total supply every day? It is good to reduce total supply of G$ into ~ 100 B, current 2 T is too much.

#13

The goal is that G$ burns on each day, 10% of shared G$. There is an address to do that. I guess the crypto based on Ethereum, as is G$, has the posibility of that address. The address is something like: 0x0000… and more 0s, or other address where those G$ becomes in unaccesible forever. Example for Shiba Inu, not the same for G$ I guess, but works as example:

#14

I’m agree, 100 Billions of G$ is a good goal for total supply!.

#15

Modification of proposal.

GIP: 16
Title: Implement a deflationary mechanism to burn 10% of UBI sent daily
Author: Cesar Cordero
Status: Stage 2
Track: Meta/Tokenomics
Created: 2023-10-19

Summary:
Burn 10% of UBI sent daily, decreasing the total supply.

Description:
Implement a deflationary mechanism to burn 10% of UBI sent daily, decreasing the total supply. For example, today G$ sent 3M G$ as UBI for all claimers, then we will burn 300,000 G$ today. It could raise the price and create interest from big exchanges. All big crypto projects burn some of their coins.

There is an address in the Blockchain to do that. The cryptos based on Ethereum, as is G$, has the posibility of that address. The address is something like: 0x0000… and more 0s, or another address where those G$ become in unaccesible forever. The goal is that G$ team reach the automation of G$ token burning to those adresses each day, sending the 10% of total G$ shared that day.

Example: Shiba Inu has a token burning system carried out by the community itself. BNB has an institutional burning system. Telegram’s crypto, TON, has a DAO-approved burning system.

Of those 3, the burning system that best fits G$ is that of Shiba Inu, because it is a Token that is on a Blockchain of another crypto (Ethereum, for example). The other two burning systems are Fees, of their own crypto. G$ fees are in ETH, Fuse and Celo. So it seems to me that a dynamic burning by UBI distribution is the model that best fits G$.

According to Bard, the AI of Google, these are the steps to burn a Cryptocurrency token:

“”"
To burn tokens of a cryptocurrency, you can follow these steps:

  1. Check the cryptocurrency’s documentation. Some cryptocurrencies have specific instructions and processes in place for burning tokens. For example, in April 2022, Shiba Inu released an easy-to-use burn portal.
  2. Send your tokens to a burn address. A burn address is a special wallet address that can only receive tokens, but not send any. This removes them from circulation. You can find the burn address for the cryptocurrency you want to burn in the cryptocurrency’s documentation.
  3. Initiate the burn transaction. Once you have sent your tokens to the burn address, you will need to initiate the burn transaction. This process will vary depending on the cryptocurrency. For example, in Ethereum, you would need to use a smart contract to initiate the burn transaction.
  4. Wait for the transaction to be processed. Once you have initiated the burn transaction, it will need to be processed by the cryptocurrency’s network. This can take some time, depending on the network traffic.

Here are some additional things to keep in mind:

  • Burn transactions are irreversible. Once you have burned your tokens, you cannot get them back.
  • Burning tokens can increase the value of the remaining tokens. By reducing the supply of tokens, burning can create a sense of scarcity, which can drive up demand and increase the price of the tokens.
  • Burning tokens is often used to reduce inflation. Inflation is the decrease in the purchasing power of a currency over time. By burning tokens, the supply of tokens is reduced, which can help to reduce inflation.

“”"

Advantages of this proposal according to Bard, AI of Google:

“”"
Here are some of the advantages of burning a cryptocurrency token:

  • Reduce inflation: Burning tokens can help to reduce inflation by reducing the supply of tokens in circulation. Inflation is the decrease in the purchasing power of a currency over time. By burning tokens, the supply of tokens is reduced, which can help to reduce inflation.

  • Increase the value of the remaining tokens: By reducing the supply of tokens, burning can create a sense of scarcity, which can drive up demand and increase the price of the tokens.

  • Attract investors: Burning tokens can be seen as a sign that the project is committed to its long-term success. This can attract investors who are looking for projects with a strong future.

  • Improve the token’s utility: Burning tokens can also help to improve the token’s utility. For example, if a token is used to pay for goods and services, burning tokens can help to increase the value of the token and make it more attractive to merchants.

“”"

1 Like
#16

The procedure to burn would be:

Each single transaction G$ send the UBI, it will be burnt the 10% of the amount to a locked wallet or dead wallet, where the G$ can’t be restored. Example: If G$ send 20 G$ for an user, plus of that 20, it will be burnt 2 G$. Total G$ used in that transaction: 22 G$.

In total it will be burnt 10% of total UBI sent that day. If it was 200,000 G$ sent for all users that day, it will be burnt 20,000 G$ that day. 220,000 G$ used in total that day.

The more users receiving G$ daily, the more G$ burnt !.

#17

It is not that it burns and rises in value automatically. It is an incentive for investors to invest. It’s like improving a webpage, the prettier it is, the more they enter and buy products and services.

But if you haven’t changed the appearance of the webpage for 10 years, people stop coming, because they don’t see innovation.

Burning is an economic innovation.

Entering Celo is an economic innovation.

Economic improvements, politicians would say.

#18

Hey All.
First there is no meaning to say “burn 10% of UBI”, since what it actually means is let’s reduce the UBI we mint by 10%, as UBI is mostly created through minting. And that was already done at the start of the bear market where we reduced the reserve ratio yearly decrease from 20% to 15%.

Other burning options could include a Tax, ie a transaction tax, for every TX there will be X% tax that would be burned.

The real question is why? because others are doing it? But if you look at the G$ price relative to all these other tokens that tanked >50% I see absolutely no reason. On the contrary we should create more UBI and I would suggest to increase the reserve decline rate back to 20%.

2 Likes
#19

But if it’s minting, why in Coinmarketcap always says: 2,100,000,000,000 G$ as total supply. When minting, that value increase and it isn’t happening. So you aren’t minting. What I mean is to reduce total supply, and in cryptos it means burning.

The reason is, for a deflationary purpose. The reference to other projects are as examples. But for people who live in Venezuela, we know what is inflation, if a coin stays static as total supply it will get generate inflation as economic rule. If we reduce total supply, it will be less offer more demand, more people will buy the coin 'cause it will call investors, result, more money by each coin. It’s an economic improvement to combat the inflation.

#20

Yeah that’s bad communication i guess. 21T is the max possible supply.
@goodanna @pedrosa.eth

You say inflation but if you look at the token price it is not suffering from inflation which significantly effects its price. Economic actions should be taken when they are needed.