Conclusions
ICP Supply and Demand dynamics are heavily influenced by current NNS staking and dissolving.
New liquid ICP supply can be forecasted to a high degree of accuracy and is expected to decrease significantly in May.
New liquid ICP demand can not be confidently forecasted at this time because it’s biggest driver (NNS Staking) is highly variable.
New Liquid ICP Supply
Narrative: New liquid supply of ICP is forecasted to decrease significantly starting in May of 2022. New supply of ICP is driven almost exclusively from ICP dissolving off the NNS.
Forecast confidence: HIGH
Dissolving NNS: High
Governance Rewards: Low
Node Rewards: High
Assumptions: Governance rewards are estimated to be 30% of total distributed rewards (the other 70% being merged maturity).
New Liquid ICP Demand
Narrative - New demand for liquid ICP is extremely volatile due to the variation in month-to-month staking on the NNS.
Forecast Confidence: Low
NNS Staking: Low
NFT Liquidity: Medium
DeFi: Medium
Computation: High
Assumptions: NFT liquidity is equal to 50% of total monthly transaction volumes across all markets.
Great job as usual Kyle! Would love to see the model specifications!
Woof woof!