An interesting milestone in the Livepeer protocol just occurred, as the participation rate, which is defined as the number of tokens staked divided by the total number of outstanding tokens, surpassed 50%. This is the target that was set at protocol genesis, and is incentivized by increasing inflationary rewards while the rate is below the target.
This occurred in round 1442, which is 482 rounds after protocol launch. The inflation rate is currently 0.1577% per round. Protocol values can be viewed from the smart contracts or in a tool like scout.cool.
If the participation rate remains above 50%, then the inflation will begin decreasing. The details of how the simple formula works are captured in this post.
It has been really great to see all the excitement in the community around participating in the Livepeer network during this early period. The anticipation for this event was fun, as it’s been a long time coming. Now we get to see what happens next, as people respond to the slightly changing incentives. I don’t expect there to be major changes in the short term as the rate of change of inflation is so slow that things will look much like they have for awhile. But we will see.
One thing that is clear, is that as Livepeer scales and more fees begin to be generated in the network with the release of Streamflow, there will be a whole new calculation that network participants will do in terms of whom to stake towards, and whether to compete for business on the network by running transcoding nodes. Speaking of Streamflow, this milestone was achieved on a timely day, as just today I was watching a demo of an active Streamflow internal testnet, which included live streamed transcoded video in exchange for probabilistic micropayments, being cashed on chain, for less than 1% overhead. It’s all coming together More progress to be made, but a public testnet will be coming soon.
Thanks for everyone for participating in Livepeer on the run up to the target rate. Now it’s time to get scaled, and deliver some major impact to the video world.