This post: https://www.stellar.org/blog/our-proposal-to-disable-inflation says: You’ll still be able to set the inflation destination on your account, for instance, but no inflation will go out. Fees will still go to the fee pool, they’ll just be locked there, inaccessible and unused. Also, recent ledgers on the public network say: Fee Pool: 1,810,125.7140461 XLM Also, most operations are showing "0" in the fee field. So my questions are: Where is that 1.8 million XLM? Is it just taken out of circulation? Is it now standard practice that things submitted to stellar have 0 XLM in fees? Without fee income, what's the incentive to running a full validator (e.g. from the stellar/quickstart docker image, if I'm understanding what that is)? I apologize if this is already hashed out somewhere else. I'll accept RTFM + link as an answer 🙂

Essentially. They are just retained in the fee pool. Fees are not 0 XLM. They are a minimum of 0.00001 XLM. It seems like StellarExpert is just reporting this incorrectly at the moment as you can pull up the transactions and see the fee paid. See Horizon response vs StellarExpert . Validators have never collected fee income. The main benefit is providing a trusted entry point to the network for your service. Using the public Horizon instance as more and more products join the network could cause your customer's transactions to be squeezed out. You would also be relying on another company / organization to determine the up-time of your own service. An additional benefit is contributing to the robustness of the network, the same network you rely on for business.

What's the current state of inflation and fees?

ddombrowsky

This post: https://www.stellar.org/blog/our-proposal-to-disable-inflation says:

You’ll still be able to set the inflation destination on your account, for instance, but no inflation will go out. Fees will still go to the fee pool, they’ll just be locked there, inaccessible and unused.

Also, recent ledgers on the public network say:

Fee Pool: 1,810,125.7140461 XLM

Also, most operations are showing "0" in the fee field.

So my questions are:

Where is that 1.8 million XLM? Is it just taken out of circulation?
Is it now standard practice that things submitted to stellar have 0 XLM in fees?
Without fee income, what's the incentive to running a full validator (e.g. from the stellar/quickstart docker image, if I'm understanding what that is)?

I apologize if this is already hashed out somewhere else. I'll accept RTFM + link as an answer 🙂

kolten

Essentially. They are just retained in the fee pool.
Fees are not 0 XLM. They are a minimum of 0.00001 XLM. It seems like StellarExpert is just reporting this incorrectly at the moment as you can pull up the transactions and see the fee paid. See Horizon response vs StellarExpert.
Validators have never collected fee income. The main benefit is providing a trusted entry point to the network for your service. Using the public Horizon instance as more and more products join the network could cause your customer's transactions to be squeezed out. You would also be relying on another company / organization to determine the up-time of your own service. An additional benefit is contributing to the robustness of the network, the same network you rely on for business.

ddombrowsky

kolten Ok, so there is no incentive to running your own core instance anymore, other than a requirement of having a local horizon instance to connect to, which gives you more control if you're planning on running applications against it. I did not know this.

Also, network fees are simply going to the fee pool, which is controlled by.... who now? Since inflation is kaput, doesn't that give a lot of central authority to some entity on a network that is supposed to be decentralized? What am I missing here?

kolten

ddombrowsky

so there is no incentive to running your own core instance anymore

Well there is, it's just not purely financial and to be clear there were never network-based financial rewards for running a validator.

The fee pool isn't controlled by someone, it's basically a pool maintained within the network.

The way inflation worked was anyone could submit an inflation operation to the network and if it had been a week or more since the last inflation operation was ran then it would initiate the inflation mechanism. Now that operation just returns opNOT_SUPPORTED.

Here's an explainer about inflation: https://www.lumenauts.com/guides/how-inflation-works
Here's the CAP that deactivated the inflation operation: https://github.com/stellar/stellar-protocol/blob/master/core/cap-0026.md

ddombrowsky

kolten The fee pool isn't controlled by someone, it's basically a pool maintained within the network.

So the question remains: who gets that 1.8 million XLM? Is it just removed from circulation?

kolten

ddombrowsky no one gets it as mentioned in your original post:

You’ll still be able to set the inflation destination on your account, for instance, but no inflation will go out. Fees will still go to the fee pool, they’ll just be locked there, inaccessible and unused.

ddombrowsky

ok, so at a base fee of 0.00001 XLM, and a total supply of roughly 50,000,000,000 XLM, that means after 5,000,000,000,000,000 (five quadrillion) operations, there will be no XLM left in circulation.

There's something like 200 operations per 5 seconds, or 40 per second, which means the network will consume itself in 1.25 x 10¹¹ seconds, or somewhere around the year 6000.

Am I understanding this correctly?

kolten

ddombrowsky I'll trust your math for the sake of convo, but it's worth mentioning that inflation was disabled in such a way that it could be reinstated if it was necessary.

CAP-0026 Design Rationale:

The proposed approach does not require breaking protocol changes and allows turning on the inflation mechanism in the future if needed.

So if year 5,000 rolls around and Stellar is consuming itself the AI overlords could reinstate the inflation.