Why can't core time priced in stable coin?
If technical fellowship is paid(priced) in stable coin and validator may be paid in stable coin (if referendum passes), why can't core time be priced in stable coin as well?
Here is my idea overview:
- core time priced in stable coin, but when user pays in stable coin, it will be converted to DOT in the backend
- initial referendum to decide the minimum price of core time (priced in stable coin)
- The multiplier mechanism can stay the same
What this does:
- avoid core time being too cheap when DOT price drops
- create a more predictable spending for parachain teams
Side effect:
- DOT demand increases if DOT price goes low
- DOT demand decreases if DOT price goes up
Comments (2)
Well I think Maciej talked about this in class, but you can tell me if this is not the answer to your question.
Core time is bought in a Dutch auction, meaning that it is truly only the value of core time that decides how much it is bought for. Whether someone chooses to pay more or less actual "value" for the core-time should not depend on the value of DOT, since they are not actually getting any other token for it.
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Paying stable coin for core time does not affect the true value of core time. Dutch auction should work the same.
But a team might plan ahead to prepare some DOT for the core time.
Pricing in DOT is adding another layer for a team to consider before forecasting their spending. It is really not that business friendly.
Let’s say I have 1000 USDT to spend.
Priced in DOT scenario:
- DOT price at $10
- Average core time costs 10 DOT
- I planed ahead to buy 10 DOT at $10
- Then core time price rises to 100 DOT (by the auction mechanism), I need to buy 90 DOT more
- Now DOT’s price also fluctuates to $11, I need to spend $990 more to buy this core time
- ($10* 10 DOT) + ($11 * 90 DOT) = $1090
- 100 DOT being burnt and I need to spend $90 more in total (Unpredictable )
Priced in Stable scenario
- DOT price at $10
- Core time is priced at 100$
- Then core time price rises to 1000$ (by the auction mechanism)
- Now DOT’s price also fluctuates to $11
- I spend $1000 to buy core time, back end logic swaps it to approximately 90.9 DOT
- 90.9 DOT being burnt and I just need to spend $1000 for core time (Predictable)
Companies are inclined towards having predictable spending. You can argue that when DOT price goes down, it is beneficial to the companies, however, the focus here is the predictability of the spending forecast.
Moreover, with the referendum of capped DOT supply being passed, is a strong burning mechanism really necessary at this point? Or a token value based burning as described on above makes more sense?
I see both sides, but personally, I think pricing core time in stablecoin could make sense for predictability. Parachain teams would know exactly how much they’re spending regardless of DOT volatility, which could encourage more consistent usage. Converting stablecoin payments to DOT in the backend still preserves network incentives, while stabilizing budgeting for teams. The trade-off is that it slightly decouples core time value from DOT market dynamics, but for planning purposes, that predictability might outweigh the downside. speed stars