1Eyk15KEeYX9JwH8e98pqpX3kTUuY9d43C (622) ·
Consider if, in the 2 week period, price drops by 50%...
But, transaction volume remains steady, and fees adjust inversely to fiat price (they're relative to fiat prices.)...
1Eyk15KEeYX9JwH8e98pqpX3kTUuY9d43C (622) ·
If a 10 minute block sees 10% revenue in fees, then in 10 minutes, only 60% of the previously expected revenue arrives in 10 minutes.
In this scenario, it would take 50 minutes to reach prior block reward parity. Likely longer to reach prior profitability.
1Eyk15KEeYX9JwH8e98pqpX3kTUuY9d43C (622) ·
Correction - moving too quickly, not being rigorous enough...
Total revenue in that scenario is 110% of the block reward, -50% = 60% of the reward *in 10 minutes*...
From 0 minutes (50% reward) to block reward parity (110%) = 60 minutes.
1Eyk15KEeYX9JwH8e98pqpX3kTUuY9d43C (622) ·
If tx fees in 10 minutes = 25% of revenue, then total reward = 125% of the subsidy...
Starting with 50% (price now compared to price in the previous period), it would take only 30 minutes to reach block reward parity (125% of subsidy).
1Eyk15KEeYX9JwH8e98pqpX3kTUuY9d43C (622) ·
And a clarification - to simplify the math, I'm using tx fee revenue completely in relation to the block reward, so in the first example, 10% of the block reward is in fees, meaning it's 1/11th of total revenue.
In the second example, 1/5th is fees.
1Eyk15KEeYX9JwH8e98pqpX3kTUuY9d43C (622) ·
The gist of all of this is to lay out a framework you can use to better understand what's involved here, and to demonstrate how important transaction volume is in pushing for the DAA to return to its original (far superior) design.