this assumes that all MNOs sell their rewards all the time. That makes the cost real. Otherwise this is all just a virtual number
In the formal (accounting) analysis this is simply not true. Masternodes are being paid. The revenue is real, therefore the cost is real. We must therefore investigate WHERE that cost is being taken and by whom. When I did this I discovered it was being drawn from the capital value of the chain because it represents a mining deficiency and mining is what creates real scarcity (i.e. if you define scarcity as effort required to obtain a scarce resource rather than simply a small number of something which is faux scarcity).
The idea that restricting traffic to order books represents a more valuable form of "scarcity" than mining is even more faux still. I can create my own crypto of 5 coins, never sell them and they won't necessarily be worth anything. But if I can somehow attract competition to extract them from the blockchain at great expense then cost of the extraction effort per coin demonstrates a commercial value on that scarcity and will set their opening price in the secondary market. (If we define the blockchain itself as teh primary market).
So whether masternodes sell or not is irrelevant. The damage is done as soon as they receive the coins because those are coins that were not used to attract fiat value into mining and never will be and the latter is the mechanism by which value is stored in the chain.
I understand you want Dash to switch to a pure PoW coin (as much as possible) and reduce both the MN reward drastically, as well as the share for DCG, but your statement stops there. What comes next? You don't answer that. Do you want Dash to become like Litecoin? You can't be serious about that
Why does anything need to change ?
• masternodes would still be profitable
• the treasure would still exist
• we'd still have all our features
• we'd still have the same development budget
We'd only be stripping away much of the redundant element of the masternode reward. It isn't paying for anything at the moment so nothing would change in terms of budgets. Nodes would continue to be profitable and in fact be MORE profitable as the marketcap increased. This is what people seem to forget - the reward ratio is irrelevant to masternode profitability because their costs are fixed. So what if they get 10% or 60% ? It all depends on the price, not the reward ratio. Masternodes could be making $1000 per week at a 20% reward share or $200 per week at a 60$ reward share.
On the other hand, reducing mining reward DOES come with a measurable cost. Arguing against this is hypocricy because the basis for the current policy is ostensibly limiting traffic to order books - thereby creating a form of "Scarcity", but not one that has any measurable value. It's a notional concept that I personally think is ludicrous because high volume, deep liquidity markets can represent high value assets as well as low value ones. What matters is what's being DONE with the revenue from selling and spending it on raising mining difficulty is a far more wealth-preserving proposal than giving it away for nothing IMO.
In my opinion the treasury is a bigger elephant in the room. That's where I've consistently seen waste.
Again, I find this argument slightly hypocritical. Masternodes are simply an extension of the treasury. They're no different from any other commercial contractor and their "delivery" should be evaluated in exactly the same way. If you don't see it that way then you need to see them simply as zero-difficulty miners which is an equally concerning proposition.
So what does Dash get for its $32 million per year from this extended treasury budget ? Hosting costs and an incentive to keep coins in wallets ? But other networks get this for free. Even if they do send more to markets, more of their blockchain goes towards raising fiat to pay for scarcity (REAL scarcity that stores capital, not faux orderbook traffic management scarcity).