Yet Another DEC to peg idea!#1470

Since it is apparently the season for unconventional dec-to-peg proposals, here is mine!

In order to lock away some of the excess dec from the economy, I propose the team make a mechanism where you can exchange dec for a new temporary coin. To make things easy, let’s call this new coin Building Materials. Materials would only have one use, and that would be to - eventually - upgrade buildings on land. When upgrading buildings, Materials would be accepted in lieu of dec at a ratio of 1:1. So a building upgrade that would take 50k dec would accept 50k Materials instead. To make it attractive to exchange, and lock away your dec until buildings on land come out, you would receive a bonus of Materials over the amount of dec you put in.

I think the best way to go about this would be to set a variable rate that would be dependent on market conditions at the time of the transaction. Whatever the percent dec is below peg would be equal to how much bonus you would get on your dec. For example, if dec was 25% below peg and you exchanged 100k dec you would receive 125k Materials. This is nice because the feature would be self-throttling because there is a large demand up front for locking away dec that would gradually fade away as dec gets closer and closer to peg.

We could also use a fixed percent bonus or a hybrid model between the two. It may be needed that the bonus to convert is greater than the discount below peg. I don’t know, I’m not an economist, so all the fine details and numbers would ultimately end up being determined by Matt & Co. and their spreadsheets.

Eventually when dec hits peg - or is nearing it with unstoppable momentum - the devs could shut this feature off and no more Building Materials would be minted again. Whatever Materials were in the system at that time would be finite and would eventually bleed off into land buildings or sit on inactive accounts.

One interesting thing to consider though, if we go for a fully self throttling system, we could leave it on as a permanent peg-maintaining safety net. It would pretty much act opposite to the mechanism for burning sps into dec. If dec is above peg then burn sps for dec, but if it is less than peg then convert dec to Materials. Again, probably something for the team to decide if this makes it their way.

Under this, If DEC is 75% of peg you can buy 1333 dec per dollar then convert that to materials for an additional 25% you would be gaining a 66% increase on your DEC. Just wait for land to come out and the DEC sinks will do their job and we will see more SPS burned.

The fact that dec is 75% of peg means you get a discount on everything, not just this. So that discount is moot, it is available for everything that you can buy with dec and is exactly what this proposal is trying to fix.

The actual bonus % is there to encourage people to lock up their dec now. Like I said in my post, the actual percentages would be determined by the team, not the made up numbers in my post.

You say to wait for land to come out, but even with the first release of land, we won’t be upgrading the buildings yet. Putting dec into buildings is at least 6 months away if we are lucky. The team has made it very apparent that they want dec to go to peg as soon as possible, so this would start to lock up that dec now as opposed to some point in the future.