Hive Inflation for May 2024! | Bellow the Projected One

in Hive Statistics18 days ago

How did Hive did in May 2024 from an inflation standpoint? Let’s take a look!

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The projected inflation for Hive for 2024 is 6.0% on a yearly basis, or 0.5% on a monthly basis.

Hive has a double currency system, HIVE and HBD, with conversions between them that add or remove HIVE from circulation on top of the regular inflation. Furthermore, the decentralized hive fund DHF, that serves as a DAO converts the HIVE that is in the DHF into HBD.
The @hbdstabilizer has also grown and it is playing an important role in the overall tokenomics, making conversions and trading on the internal market.
Because of this additional mechanics the HIVE inflation and supply can be drastically different in real time than the regular/projected one.

To be able to follow the HIVE supply we need to take a look at all the different ways HIVE is created, author, curation, witness rewards, conversions etc, then net that out with the HIVE burned from conversions, accounts fees, null transfers etc. To get the virtual supply we need to do the same for the HBD supply as well.

HIVE Created

Here is the chart.

image001.png

The chart above includes:

  • Author rewards
  • Curation rewards
  • Witness rewards
  • Staking rewards

These are the regular ways new Hive enters circulation, and all of them are through vested HIVE, aka powered up. You can notice the slight fluctuations in the daily amounts that is connected with the virtual hive supply, or the base for inflation. When the price of HIVE is low, the virtual hive supply increases, and when it is up, the virtual hive supply decreases.

The thing is the conversions are playing a major role in the ecosystem. Here is the chart again, including conversions.

image003.png

We can notice that the HBD to HIVE conversions are the dominant in the chart. This works in both ways and a big part of them is converted back to HIVE, especially through the work of the stabilizer.

The regular inflation is around 70k HIVE per day.

We can notice the drop in recent months. This is because the stabilizer has changed its funding from the DHF and has reduced the daily amount of funds it receives and sends them back to the DHF making less conversions in the both directions.

HIVE Removed from Circulation

Here is the chart.

image005.png

The above takes into consideration six different ways of HIVE removed:

  • Ninja Mined HIVE To HBD Conversions In DHF
  • HIVE transfers to DHF and converted to HBD
  • Transfers to null
  • Null as post beneficiary
  • New accounts creation fee
  • HIVE to HBD conversions

The HIVE transfers to the DHF are now dominant. These are transfers made by the stabilizer. We can see a few spikes in the HIVE to HBD conversions (blue), with one occurring just recently. These were due to the increase in the HBD price. We can also notice the drop in recent months, same as the opposite conversions due to the low volumes that the stabilizer is doing.

Historical HIVE Supply

When all the above is added and removed, we get this chart for the all-time HIVE supply.

image007.png

Up until August 2021, the supply was almost steadily increasing with a small fluctuation. Then a drop in the supply in September 2021. Since then, from time to time we can see some drops in the supply with the recent happening in February and April 2023. March 2024 ended with 430.2M HIVE in circulation.

HBD Supply

Here is the chart for the HBD supply.

image011.png

The light color is HBD in the DHF. The HBD in the DHF is not freely circulating HBD and only enters circulation when payouts to the DHF workers are made.

HBD is being created and removed in various ways, but the conversions play the major role here in both directions. Other ways HBD is created are DHF proposal payouts, author rewards and interest.

We can see that after a downtrend in 2022, in the last period the HBD supply is very stable around the 11M, with an increase in the last months.
In the last month the HBD supply has increased from 11.7M to 12.3M HBD.

Virtual HIVE Supply

When we add the HIVE equivalent supply from the HBD to the HIVE supply we get the chart below.

image013.png

The light color is HIVE that in theory can be converted from HBD at the current market prices for HIVE.
We can see that the virtual supply fluctuates a lot, mostly because it is tied to the price of HIVE. As the price of HIVE drops, the virtual supply increases and the opposite.

When we zoom in 2023 - 2024 we get this:

image015.png

In 2023 and 2024 we can notice a steady numbers in the virtual HIVE supply because the price has been relatively stable in the period. The regular HIVE supply has slowly increased in the period.

Projected VS Realized HIVE Inflation in 2020 - 2024

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This chart tells the story of the new HIVE entering circulation in 2020 – 2024.
We can notice the sharp drop back in September 2021, when there was a lot of HIVE burned for HBD due to the HBD high prices. Since then the realized has mostly followed the projected inflation with some small bump on the road. In the beginning of 2023 there was again a reduction in the HIVE supply due to burns for HBD, and more or less a steady drive from there till today.

Since the creation of HIVE four years ago the realized inflation is at 80M, or on average 20M per year, while the projected inflation is at 96M. So, we can see a difference in 16M less HIVE created in the four-year period. This is mostly thanks to 2021 when the year ended with negative inflation.

Monthly Inflation

If we plot the monthly inflation in 2020-2024, we get this.

image019.png

This is a long term trend for the monthly inflation. We can notice once in a while a negative inflation happening. This is when there are a lot of HIVE to HBD conversions.
In the last month the Hive inflation is at 0.36%, or slightly below from the projected one at 0.5%.

In terms of absolute numbers, the HIVE supply in May 2024 has increased from 428.7M to 430.2M, adding 1.7M HIVE in circulation, while the projected one is around 2M.

Yearly Inflation [%]

The yearly, projected and realized inflation looks like this.

image021.png

Last year 2023 ended with a Hive inflation of 5.7%, when the projected one was 6.5%. From the first five months of 2024 the trend is for 2024 to be around 6.5%, while the projected one is 6%.

Net HIVE Created by Category in May 2024

Here is the new HIVE put in circulation by category for the month.

image023.png

Conversions are negative with -0.5M HIVE burned in the month. Because of this the HIVE inflation in May is slightly below the projected one. This means that more HBD was created, slightly increasing the supply of HBD. Conversions are the main variable that is changing the Hive inflation and when they are positive the inflation is slightly above, or when they are negative the inflation is below the projected one.
The curation rewards are on the top with 930k HIVE. Next are the authors rewards with an 490k HIVE added.
Some HIVE was burned for @null as beneficiary and account creation fees.

Note that authors rewards are paid 50% HIVE, 50% HBD, and the HIVE share only is at 490k, while approximately the same amount was paid in HBD equivalent.

All the best
@dalz

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Wow things a moving speedily, It's amazing how the mechanics of conversions and stabilizers impact Hive's inflation and supply. Seeing the charts and fluctuations really puts it into perspective. I'm certain there are exciting times ahead of us

Thanks for sharing this
I guess we’d be able to see more of this on your page
Right?

It is good that Hive seems to be moving as expected. Thank you for continuing to monitor and share these data.

The Hive supply is getting higher. That’s good tgough and it looks like we’re having more accounts that are active. You mentioned something about the new Hive in circulation. Is Hive always created everyday or how?

uh.. That comment makes no sense.