New BYT Proposal Nov 2022

The last BYT proposal extended the program for a further 3 months; those 3 months have gone quickly, and November requires another vote. As always, there is only one option and, if the majority vote is a "No", then another proposal will be created. We have till the end of November, so there is plenty of time.

This proposal is slightly different, in that I propose to wind down the BYT program. There are a number of reasons for this.

The number of active tokens has barely increased since the end of May; this shows to me a lack of interest. Sure, the token price has dropped, but the yield has held steady during this "crypto winter". That takes time and management to achieve; and BYT would be worth half of what it is today had I just sat and watched it. That manifest lack of investor interest extends to a lack of support on the Blurt platform. You know, this is a BLURT Yield Token - no income, no yield, no weekly distributions. I have to add that a few people continue to support the project, just not enough to warrant the time it takes to manage.

The Winding Down Process

I have managed similar tokens over the past 5 years, so have seen what works - and what takes an eternity! BYT is slightly more complex as it involves tokens across different platforms with different timescales to unstake or unbond investments. So instead of doing one large buyback at the end, this will be done gradually. Even done gradually, most people wait till the end so as to get the best price. Hence, most of the value will be paid out in distributions rather than wholly in token buybacks. You get the same cash value without waiting till the end.

The BYT fund has a mixture of holdings equivalent to over 37k HIVE, or about 3.4M BLURT. Although not a massive amount, it is enough to move some low-liquidity markets significantly. Hence, why this will be done prudently so as to retain as much value as possible.

I propose a "soft close" after 4 months plus a "hard close" after 6 months. Thus, BYT earnings will stop at the end of March 2023, and buybacks will be completed by the end of May 2023. The difference between the soft and hard closes is that no distributions will be made after March 2023. If everyone is paying attention and all tokens have been sold back to admin, then those last 2 months may not be necessary. However, from experience, there are always stragglers.

So, from the 1st December, be prepared to see higher weekly payouts and the ABV slowly falling. The ABV has two components, the value of all assets and the BLURT/HIVE swap rate, so there may be weeks when the ABV rises even though the distributions are higher. The target price at the end of the soft close will be 0.1 HIVE. Yes, this is lower than now, but try to understand that you will by then have received the rest of the value in weekly payouts. This is how investment trust income shares work! The actual closing price will be announced nearer the time as is likely to fluctuate.

The beauty of this approach is that the remaining capital is still earning during the winding down process. Only at the end of March will this stop. So, the decision for investors is whether to sell tokens early at a higher price or wait and take the higher weekly income and a final lower price. One can always do a mixture of the two strategies.

The Random Bonus payouts will continue, but will not be only in SWAP.HIVE. Instead, they shall be a way to return some of our more abundant tokens to investors, who can then do as they wish. This will obviously include SWAP.BLURT but may also be in SWAP.HBD or even SPS or SIM. Some users will, hopefully, appreciate those tokens, while others can obviously sell them. The point is that this will have far less of an effect on markets and swap pools on Tribaldex. There are some pools that have been very profitable but still have low liquidity and are vulnerable to large changes of stake - in either direction.

Summary

The BYT program will be winding down.
The method is to distribute the token value by higher distributions while lowering the ABV - turning capital into income.
A soft close will be at the end of March 2023, at which point all earnings and distributions shall stop.
A hard close by the end of May 2023 will complete all token buybacks at an ABV announced near the time.
Bonus payouts will continue, but may also be paid in tokens other than SWAP.HIVE.

Proposal

The BYT fund shall be wound down, starting on 1 December 2022, and proceeding according to the method and timeframe stated above.

Voting

As with previous such proposals, we shall take a vote in the comments.
Vote "YES" to accept the above proposal.
Vote "NO" to reject it.
Votes are proportional to the number of BYT tokens held. If the vote is very close, we may use a third-party voting site.
As previously, there are some large investors who do not use Blurt, and their votes shall be sought through direct messaging.
If there are strong opinions that any of the above needs to be amended, such as the dates, then we can create an amended proposal.
The voting period ends when this post expires after 7 days.