How exactly does monetary policy work?

English General Discussions
1

Cardano’s document explains how monetary policy is applied. A monetary expansion rate of 0.3% is selected for the withdrawn amount from the Reserve per epoch
(Cardano monetary policy | Cardano Docs).
But the historical treasury/reserve balance shows that the actual expansion rate is not the same:
(https://cexplorer.io/pot):
Epoch 508: Reverse balance = 7802782712972540 (lovelace)
Epoch 507: Reverse balance = 7816251180544570 ==> Burnt down reserve = 13468467572030 ~ 0.1723%

Can somebody help to clarify the differences? Thanks

2

Hello @Tung_Pham_Duc

0.3% is a maximum amount that would be paid out as rewards if all pools were perfectly efficient. However, most pools are not fully saturated, nor do they have an optimal pledge amount so they do not receive a full reward amount that is available per block.
Any rewards not fully claimed remain in the reserve.

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3

Thanks for your infor.

4

i see some explorers show the statistic of Reverse / Treasury
One more concern if you could help: Where / how can we technically collect the actual reverse after each epoch?

5

I’m unsure what “Reverse” statistic is. I think you may be thinking of Reserve.
If you are looking for API services to provide this info you can try https://koios.rest/
They used to have a free option. However, you may need to parse and calculate specific data if you are looking into something specific.
I heard that Omigos is also good, but I never used it, so I can’t say.
If you know how to do it yourself and have access to Cardano node (and a computer with 32GB of RAM) you can extract this info yourself. Use:

cardano-cli query ledger-state --mainnet > ledger_state.json

If you don’t have a powerful computer, this can take for EVER! It’s a HUGE, almost 2GB, CBOR file that takes a long time to generate.

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6

Reverse: This can refer to metrics that measure the performance of an investment relative to a benchmark, often in arbitrage strategies.

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