I’m kinda against having those super long lock-ups for bigger discounts. I think they benefit users more than ShadeDAO itself.
Variable lock-ups are used to smooth out the rate at which people looking to dump their discounted SHD do so.
High discount SHD with large lock-ups make no sense for a couple of reasons:
People that are willing to lock funds for long periods would also lock funds for shorter periods and likely not sell once unvested (due to their positivity on SHD long-term);
Each additional percent of discount results greater inflation of SHD as additional SHD must be minted to obtain the same amount of liquidity; and
The discount provided on the purchase of bonds is relative to a couple of items (noted below). With the current state of the market, I don’t think people are in a rush to sell their assets for fiat.
a. the sacrifice of price action on the depositing asset; and
b. the illiquidity of the received SHD as a result of a lock-up period (time value of money).
Generally speaking, I would be quite against offering large discounts for ShadeBonds. If that means lock-up periods stay below a month, at this stage of SHD - I would be quite happy with it. Once Shade Protocol matures with a broader suite and a price point more reflective of its value, larger discounts with corresponding larger lock-ups may become more reasonable.
Starting supply is 10m, but new coins can be create by bonds. This is an interesting mechanic because someone gives 1 SHD of Another Asset, and gets 1 SHD Back. So what happens in that case? Well we create a new Shade, but the protocol now owns a Shade worth of assets. This means that the Book Value of your prexisting Shade goes up. Right now technically it’s 0. We have no or few uncorrelated assets. So in a sense you have some inflation but its captured by equal value and raises everyone else’s book value.
Because anything is more than nothing. Right now we have no uncorrelated assets so any addition is positive. As long as you issue at a price > book value its accretive to older holders.
Is price > book value saying you’re able to sell at higher than spot price? Then I would agree. A discounted bond would mean price < book val, if I’m using your terms correctly?
I don’t quite understand what this analogy is about. Is Carter making a distinction here between “fixed amount of assets” and “equity”? If Bob paid Zach cash for his services, does this make a difference? My reading of this analogy at the moment is that this is an argument against ever renting or paying a 3rd party for services, which I’m guessing is not right.