[michael_j_ward]

What the argument misses / why FTT is different than Terra

1) Alameda Research owns FTX, one of the largest and arguably most important crypto exchanges.

2) FTX offers fee discounts to FTT-stakers and additional discounts if you pay in FTT. [0]

3) Trading volume on FTX thus creates an organic demand cycle for FTT. The large firms will buy, stake, and then continuously refresh their supply.

4) The vast majority of the volume at FTT will be in margined accounts at FTX. I am uncertain if the volume analysis would capture FTT movements in (3).

Now, there's clearly financial alchemy going (giving away real economic value to boost an asset that you can then get leverage on) but that'd be better for Matt Levine or someone to flesh out.

[0] https://help.ftx.com/hc/en-us/articles/360024479432-Fees

[gus_massa]

The problem with Terra was that the stakers got a guaranteed* 20% anual interest in dollars*. You can take a look at all the fine print and implementation details, or be a naysayer like me and read the 20% and claim it will collapse.

I can't find the details about FTT/FTX. How high is the guaranteed* anual interest in dollars*?

* With some mild assumptions, like the coins doesn't crash miserably. Past performance does not guarantee future results. YMMV.

Note: This year with a 7% inflation rate perhaps a 20% is not too unrealistic as in usual years with a 2% inflation.

[michael_j_ward]

heh - you're obviously correct and now I'm kicking myself for forgetting the #1 difference.

FTT does not offer any sort of interest like Terra did. The benefits of holding are strictly discounted use of the FTX platform [0]

[0] https://help.ftx.com/hc/en-us/articles/360052410392-FTT-Stak...