The purpose of this document is to propose an emergency temporary KRE payout calculation adjustment.
In the past week, Kin grew by more than 600%. Due to the lack of elasticity in KRE payments, this has resulted in massive payouts that have stifled the potential economic growth of Kin. While the KRE should seek to stabilize and broaden payout readjustment to a higher time-frame as the market matures, this system was not optimized for extreme short-term price volatility or low liquidity, and is not forecasted to adjust until TDE sale prices, therefore hindering growth until that point. This was predicted by Kik Engineering as a potential issue and is noted in current-KRE:
In the event of a dramatic price change (+/- 50% as defined by a 7-day average of closing price on CoinMarketCap), this frequency of recalibration can be more dynamic and can be addressed through a proposal to the Foundation.
As such, this proposal seeks to outline a move toward dynamic recalibration.
- KRE Algorithm Updates
- Temporary dynamic payout adjustment: As the "central bank" of the Kin Economy, the Kin Foundation should intervene and adjust inflation dynamically for as long as they forecast potential high volatility (as opposed to remaining static until an even larger increase in price).
- Temporary Dynamic Payout Adjustment KRE payout amounts should be immediately adjusted for the recent increase in price as determined appropriate by the recommendations of Kik Engineering and the Kin Foundation as well either manually at a more regular interval thereafter (e.g. monthly), or at a preset sloping scale based on forecasted performance of the economy.
It is recommended that this KIP be expedited to be approved by the Kin Foundation and enacted immediately, possibly along with KRE 3.0 if appropriate.