Splinterlands: Providing discount for burning SPS for DEC will be key to more growth.
There is current proposal active for vote that proposes to Reduce SPS to DEC Conversion Fee . To give a gist of this proposal, let me explain why SPS to DEC conversion is required at all? , and how in the coming days SPS and DEC conversion going to be most used utility in Splinterland's ecosystem which in current days is rarely used.
Why we require SPS to DEC conversion.
DEC earlier used to be the Play2Earn currency of the Splinterland's ecosystem and emission of DEC was used to governed by the market price (or demand) of DEC. Team decided that 1000 DEC is equivalent to $1 USD and same price of DEC they start honoring irrespective of market price when they sell items. Generally DEC remained in peg due to this system as if market price of DEC go down, player will buy DEC from market to buy packs from game shop , being DEC honored at peg at game shop, player earned the discount in game shop for doing purchase through DEC.
Since DEC remained below or at par, DEC emission was also not an issue but when SPS launch is announced and SPS airdrop is also proportional to the amount of DEC held in the account, a sudden demand of DEC is generated in the market and DEC went 15x above for the time being.
Increased market price of DEC , lead to the massive emission of the DEC and once SPS airdrop ended after an year, ecosystem is now flooded with DEC and demand of DEC was dipped. To counter this massive DEC , series of steps were taken like curbing the sources of DEC emissions (where DEC was no longer awarded as Play2earn rewards) and initiating the burn of 2% DEC at every market transaction.
But still, the enormous supply of DEC that get generated during SPS airdrop, is now requiring years to be consumed even with almost no or negligible DEC in emission.
Though DEC emission is curbed, but DEC sinks and DEC requirement is still there.
DEC is still required for :
- Staking in land.
- Rental fees for cards and SPS.
- Player 2 player transaction happening through market interfaces.
- Buying from game shop to get discount if DEC trade in market below peg.
- Guild fees/ upgrades.
- Pairing the resources in Defi ecosystem of Splinterlands to earn fees/rewards
- Potions (Though Glints can also be used.)
How in the coming days SPS and DEC conversion going to be most used utility in Splinterland's ecosystem
As I explained earlier that DEC emission is now curbed but players still do have DEC requirement and will do have in future. In current times burning SPS for DEC is the mechanism that will be generating DEC for the player/game need. Though we can have DEC by burning cards also, but market price of cards is generally much higher than their DEC burn value so this option is rarely used to get DEC.
DEC was below peg till couple of weeks as ecosystem buffer has not dried up till now, but this is going to change with Conclave Arcana set, where all the available DEC in the market is not enough to complete the purchase of Presale and it simply means, DEC will hit the peg (as we are currently seeing in market) and SPS burning is going to happen to fulfill DEC needs. (This explains why SPS is also surging currently.)
About the proposal.
Earlier it was decided, that for burning $1 of SPS, player/user should get 975 DEC and new proposal is increasing this value for player/user to 995 DEC. So it means less SPS is need to get the amount of DEC.
I am not against about the current proposal but I feel to incentivize burning SPS , we should remove fees completely and provide discount, let give player 1005 DEC for burning $1 of SPS.
Removing fees will incentivize the behavior of burning SPS, less fees is the less barrier to entry but still a barrier.
If you are wondering will it cause massive burning of SPS , then answer again lies on demand and supply of DEC , If DEC market price let fall to 95 cents per 1000 DEC, then player will buy from market instead of burning $1 of SPS to get 1005 DEC. But if DEC price is at $1 per 1000 DEC, it will definitely incentivize to burn SPS to get DEC.
My 2 cents.
If we go to coinmarket cap, SPS price will be defining the worth or marketcap of Splinterland game, same way where AXS token is tied to Axie infinity market cap.
Having more demand and price of SPS token will keep the game in the higher ranking , give the higher exposure to the game,
Getting more DEC for SPS in my opinion is win-win situation is for both players and game.
If you have not played Splinterlands or will be returning player, then I will say let give Splinterlands a try.
If you like to read more of my recent Splinterland's post, then please find the link below.
Link to my previous but recent splinterland's post.
Splinterlands: 22nd April has a lot to offer.
Splinterlands: My memorable/remarkable moments
Splinterland's Changes that helped me to reach Leaderboard position
Splinterland's : My tips to survive in Survival mode.
Splinterland's: Maybe the time has come for the Splinterland assets pump.
Splinterland's : My honest review of the Survival mode.
Splinterland's: I am feeling lucky in the game today.
Splinterland's: Step by Step guide on creating and renting custom sets.
Splinterlands: Start of new era in Splinterlands
Splinterlands: It is time to stack DEC.
Join the game.
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I saw a few of the players joined the game using my affiliate link and then stopped playing after few battles. If you have any difficulty in playing game, do not hesitate and join the game discord. It is really helping community and contact me here or on discord, I will definitely review your game for your better game experience.
