This is a report for the Hive supply and inflation for June 2022.
While the overall crypto market has been in a downtrend for yet another month, the HIVE price has been on a roller coaster in June, going down, then a sharp increase and down again.
Having in mind some of the Hive specific a downtrend price can cause a pressure on the HIVE inflation.
Let’s take a look!
The projected annual inflation for 2022 is around 7% , or 0.58% on a monthly basis.
The thing is Hive has a double currency system HIVE and HBD and there are conversions between them that add or remove HIVE from circulation on top of the regular inflation. Furthermore, there is HIVE in the DHF that is slowly being converted to HBD and also HIVE sent to the DHF is also converted to HBD. Because of this additional mechanics the HIVE inflation and supply can be drastically different in real time then the regular 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.
PHOTO
- HBD to HIVE conversions
- Curation Rewards
- Author rewards
- Staking Rewards
- Witness Rewards
All the above are paid as Hive Power or VESTS, except for HBD to HIVE conversions.
We can notice that the HBD to HIVE conversions are the dominant in the chart. Thing is this work 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 60k HIVE per day. In June there was on average around 391k HIVE per day from HBD conversions, although as noted most of them are converted back to HBD. A big part of the conversions in both of the directions are now generated from the @hbdstablizer.
A total of 13.6M HIVE was created in the last month, out of which 11.7M from conversions and 1.9M from regular inflation.
HIVE Removed From Circulation
Here is the chart.
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
As we can see the conversions from HIVE to HBD that happened at the end of August and begging of September 2021 have impacted the chart heavily. On a few occasions there was 2M HIVE converted to HBD in one day.
In the last period the amount of HIVE sent to DHF keeps increasing because of the work of the @hbdstabilizer that keeps increasing its volume.
Cumulative a total of 10M HIVE was removed in June 2022.
HBD Created
Here it the chart.
The above is a chart for HBD created without the conversions. It includes to following.
- 10% share of the inflation to the DHF
- HBD Author Rewards
- Interest payouts
- HIVE to HBD conversions
- Ninja Mined HIVE To HBD Conversions In DHF
- HIVE transfers to DHF and converted to HBD
Here again we can see that the conversions are dominant when it comes to adding a new supply of HBD.
The HBD created from HIVE transactions to the DHF are now dominant. This comes from the @hbdstabilizer.
The ninja mined HIVE conversions are also adding significant amounts of HBD in the DHF. Note that the HBD in the DHF doesn’t count as debt.
A total of 4.7M HBD was created in June 2022, most of it from HIVE transfers to the DHF from the stabilizer 3.8M HBD.
HBD Removed
Now let’s take a look at HBD removed. Here is the chart.
HBD is mainly removed when converted to HIVE, but also with transfer to @null and setting null as beneficiary on posts rewards.
HBD is being converted to HIVE when the price is below the peg. In June on average there was around 167k per day converted to HIVE and again most of it is from the stabilizer.
HIVE Supply
When all the above is added and removed, we get this chart for the all time HIVE supply.
Up until August 2021, the supply was almost steadily increasing with a small fluctuation. Then a huge drop in the supply in August and September 2021. An increase since then and at the end of June we are around 385M HIVE in circulation.
HBD Supply
Here is the chart for the HBD supply.
The light color is HBD in the DHF.
As we can see the HBD supply has expanded a lot in 2021, but it has been in the downtrend in the last months.
While the HBD supply in the DHF is growing and it is maintaining the cumulative supply around 24M, the HBD supply excluding the DHF has been going down and now it is around 7.8M HBD.
In the last month the supply of HBD (excluding the DHF), decreased for around -0.7M. As mentioned, it was most because of the conversions to HIVE. With this amount of HBD and the HIVE price the debt is now at 3.2%.
Virtual HIVE Supply
When we add the HIVE equivalent supply from the HBD in circulation to the HIVE supply we get the chart bellow.
When we zoom in we get this.
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 quite a lot, mostly because it is tied to the price of HIVE. As the price of HIVE increases, the virtual supply decreases and the opposite.
The virtual supply increase a lot in May and it decreased a bit in June.
Monthly Inflation
If we plot the monthly inflation, we get this.
The red is the HIVE only inflation, the light white VIRTUAL HIVE inflation, and the whit is the projected inflation.
The monthly inflation for June 2022 is 0.95%. The projected monthly for 2022 is 0.58%.
It is a slight increase from the projected one, but still not as much, having in mind the market conditions that we are currently in. The virtual supply has contracted in June, compared to the end of May 2022. This one depends a lot on the price and we can see that it is changing a lot.
The highest the monthly inflation has been is 1.54%, and on the low side it has reached negative -3.83% in September 2021. A reminder that these are monthly numbers, to get the yearly equivalent just multiply *12.
The yearly inflation, projected and realized looks like this.
Quite the differences in the past years between projected and realized inflation. Again mainly because of the HBD conversions. In 2019 and 2020 we can see that the realized is quite above the projected, while in 2021 the inflation is negative -2.7%.
2022 is projected at around 7% (0.58% monthly). For the first half of the year the inflation is at 4%, if the another half ends similar then we will have yearly inflation of 8%, or just a 1% above the projected one, that is not bad at all having in mind the market conditions and the past performance under similar conditions. It remains to be seen how will this unroll in real time.
Net HIVE Created By Category
Here is the new HIVE put in circulation by category in June 2022.
The conversions are on the top spot for June 2022. In the last month they were usually in the second place after the curation rewards, but for June they are significantly up and this is basically the main reason the overall HIVE inflation is also a bit larger than usual.
Net HIVE created in June 2022 3.6M, up from the 2.4M in May.
All the best
@dalz