Degen

I wanted to see how much damage overstaking is doing so I finally sat down and figured out how to write a Dune query.

Since this is my first query, I welcome someone checking my figures/calculations, but it looks pretty valid to me.

If you don't want to click through, here's the results as I write:

Lost Allowance Amount:            392,174
Total Overstake Amount: 	   33,989,745
Total Locked Amount:        390,023,685

                        Below Allow. Cap   Above Allow. Cap
% of Stakes     81                           19
# of Stakers    6,736                      47
Staked Amt.    315,298,133           74,725,552

So about 9% of allowances are lost that could have been distributed to smaller stakers because of overstaking. 

Some people may think that's no big deal, but it is to me. Small stakers need all the help they can get and their allowances will continue to go down as more people lock up their DEGEN. They are stuck for 3 months like this...

I wanted to see how much damage overstaking is doing so I finally sat down and figured out how to write a Dune query.

Since this is my first query, I welcome someone checking my figures/calculations, but it looks pretty valid to me.

If you don't want to click through, here's the results as I write:

Lost Allowance Amount:            392,174
Total Overstake Amount: 	   33,989,745
Total Locked Amount:        390,023,685

                        Below Allow. Cap   Above Allow. Cap
% of Stakes     81                           19
# of Stakers    6,736                      47
Staked Amt.    315,298,133           74,725,552

So about 9% of allowances are lost that could have been distributed to smaller stakers because of overstaking. 

Some people may think that's no big deal, but it is to me. Small stakers need all the help they can get and their allowances will continue to go down as more people lock up their DEGEN. They are stuck for 3 months like this... 

https://dune.com/queries/3912382

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Thought you all might be interested.

I made another query that lets you simulate what things might be under different total daily allowance, allowance cap and staking cap scenarios.

Try it out and see if you can get better outcomes than I did.

Just adding a staking cap of 800k got rid of almost all overstaking and helped push the minimum stake for maximum allowance (MSfMA) down too. It's too late to do that now, of course, but capping staking at 1m would have been a good idea for everyone. Not enough thought went into this beforehand.

Adjusting the allowance cap down makes the MSfMA go up, and that's not great, even though it helps reduce overstaking.

Adjusting the amount of daily allowance doesn't have an affect on overstaking, but can lower the MSfMA which really doesn't mater now that most people who were going to lock have already done it.

Capped staking would have been the real fix for this so that's sad. Not sure how to adjust the allowance algo without some really fancy math now.

https://dune.com/queries/3912919

I did write another query where you can plug in the numbers to play with things yourself if anyone finds this thread.

I did write another query where you can plug in the numbers to play with things yourself if anyone finds this thread.

https://warpcast.com/bluecockatoo/0x5fdf5770

After thinking about these results for a while, it also occurred to me that the extreme overstakers (those staking multi millions) also pushed the amount to stake for the cap allowance higher than it needed to be (about 830k now).

If everyone had capped their own staking to like 500k then things would look a lot different, I bet. 

I will think about how to simulate that.

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That's a possibility, but I don't think it was consciously designed to hurt everyone. 

I think that the devs' goal was to get as many people to stake as possible because that keeps the price of DEGEN up/stable, and then to give the benefit of tipping as the carrot to make that happen. 

I think they didn't really think it through and thought setting up an allowance cap would be good enough to flatten the curve and didn't realize that with excessive overstaking it would not only be bad for small stakers but also overstakers who could use that money to make themselves more money in other ventures.

maybe it was all designed that way! lmao!!

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Just from the comments I've seen on most threads from people, they were just ITCHING to stake their degen. So many of them didn't care for how long or what benefit. A lot of them just wanted to support it and thought it was a good thing. But no one thought through or warned how it would affect smaller stakers.

To clarify too, the number of coins distributed via allowance every day is fixed at 4.5m. So they can’t really influence that. 

It’s just about who gets to distribute how many.

Maybe they overstaked on purpose to reduce the number of tokens being distributed to reduce supply and increase the price of the token and make tips more valuable and harder to get?

Glad you found it useful! 💙 
I made another one that lets you play with the caps to see how it affects things, if you are interested in that!

𝔽𝕚𝕣𝕖 𝕕𝕒𝕟𝕔𝕖𝕣, 𝔸𝕣𝕥𝕚𝕤𝕥 & 𝕐𝕠𝕘𝕒 🔥

Glad you found it useful! 💙 
I made another one that lets you play with the caps to see how it affects things, if you are interested in that!
https://warpcast.com/bluecockatoo/0x5fdf5770

Fantastic work putting all this together! I only locked a little to share with my supporters. 🎭

everything i write here is financial advice

I mean just 6 months in crypto would give you the knowledge of why locking is bad and how whales are always going to manipulate things when they can. It takes more thought than a few surveys of degens motivated by FOMO to come up with a truly equitable system. But here we are.

The craziest part of this is that you could've not had these user errors, or manipulation through under/over-tipping, or any of it, if you had what a 1st semester design student could've explained:

List all the things you don't know. Spend 1.5 day educating yourself about them. Could be reading the many observations of perverse incentives in groups, human unintentional error spiles for systems without direct cause / effect state reactions, etcetera

Kudos on this! I appreciate this discussion. 

I think thoughtful study and rational decision-making contradicts the degen meme, but it's my preferred way of navigating crypto. 😄

Yeah about 390k the last I looked.

Thanks! 

I am pretty resolved to moving on from Degen unless this allowance algo changes. 

It’s just not cool to lock people into already small and ever diminishing allowances for 3 months.

this looks amazing. sadly i dont have any degen to tip but it would be worth it. 
9% is like… 400k degen??

its a lot

👏👏👏
🎭(That's the only thing I can afford to tips)

👏👏👏 46 $DEGEN 

Staking tied to allowance is bullshit. After my 3 months is up I think im done unless they make serious changes but I don’t think that give af

Yup we need some clever ways to reuse this "lost allowance" since it's only going to get worse as more people stake.

Hope this "tweak" comes earlier than later down the road.

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Allowances for everyone except for those over the current “minimum stake for maximum allowance” (MSfMA) will go down as more people stake. The pie is always getting smaller and that is by design to encourage you to keep putting money in and extending your staking lock period. 

Setting a limit on the amount of total and an allowance cap instead of just a fixed allowance per amount you staked is where the problem is. The MSfMA also moves as more people stake, and so even the whales aren’t “safe”. 

No one wins here but the devs in the end. Locks are just a hostile mechanic and proportional allowances with caps just adds to the problems for everyone.

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Thank you, Aaron! 💙 💙 💙 
I appreciate the tip!