For the last couple of weeks we have been working on a feature that was approved in Motion proposal 48623: Maturity Modulation.
Recall that Maturity is an attribute of a neuron that changes depending on the actions of a neuron, e.g., it increases when a neuron votes. While Maturity can be used to produce ICP, it is very different from ICP. The modulation in the process of producing ICP from Maturity highlights this fact.
Yesterday’s update of the NNS FE dapp makes these changes available for all users
The main UI change is a new flow when spawning a neuron from maturity and better explanations in the UI explaining the process.
Okay, so this is really really really really appreciated for those of us who have been stressing about tax time. I mean really appreciate it. Even though it is only a temp. fix/ trial it is progress. However, I still would really appreciate a bit more explanation. For example, right now the neuron that I created in June of this year still only says merge/ spawn maturity. Is this because it is still new and therefore can only merge? I am struggling to wrap my head around that part atm… Then for future maturity. If I do want it to go into my overall stake to increase my overall stake and increase voting rewards I will at some point be asked to select this correct? Otherwise, the other option is what exactly? If I can be humble and ask that this be explained like I’m a 5-year old I would appreciate it. I am 85% there lol However, I admittedly have learning disabilities and want to be positive I’m processing this properly prior to just going in all willy-nilly, having a good old time until my “big brother” drops my a** with a tax bill.
The dapp will never ask you to merge maturity, if you want, you can do that at any point.
When Merge Maturity button is disabled, it’s because there is no maturity at all. When Spawn Maturity is disabled, it’s because the maturity is not enough to create a new neuron. There are tooltips explaining both.
Merging maturity adds the maturity to the stake and voting power of the neuron. You can do that at any point. But it is not required to do so.
There are two options with maturity:
Spawning a new neuron, as explained in the wiki article. In the end, the important thing here is that after seven days you have a new neuron. This new neuron is unlocked and can be disbursed (after seven days).
Merging the maturity into the current stake. This part just increases the stake and voting power of the current neuron.
I hope this helped you understand and don’t hesitate to ask any more questions if you have any doubts!
For now the modulation mechanism only effects spawning a neuron. I believe there is the plan to bring something similar to merging maturity. Maybe @bjoernek can answer that better than me.
How can we find out if we will gain or loose within the 5% before spawning? I look at the entire dashboard but found nothing. Is there a way to estimate?
This makes sense now I was confusing this feature with another function of maturity. I apologize for the confusion. Thanks for the patience…
One last comment… To help clarify (for myself) what exact implications this has for tax purposes… Does this mean we only create a taxable event through this process described? Or in other words, does compounding maturity in form of spawned neurons (this process), now the only way the IC sees as taxable even according to the ledger because of the distribution method? Or, am I confused and have it backward? Or wrong altogether? If I am please, don’t be shy. I’m just trying to learn/ understand and prepare best.
I don’t know why my neuron since I left the community fund is not generating rewards for voting, strange is that it generates new neurons with zero ICP but it does not generate maturity or rewards and I follow everyone
I don’t understand " * The modulation function gives an incentive for users to disburse maturity when the ICP/Cycles conversion rate has been increasing over time and to hold back when the ICP has been decreasing recently. For example if the ICP/Cycles conversion rate was monotonically increasing, then w1, w2, w3, w4 are positive and thus also w, incentivizing users to convert a maturity amount x to x * (1+w) units of ICP."
If the ICP/Cycles conversion rate was monotonically increasing， then a1<a8, a8<a15, a15<a22,a22<a29, w1,w2,w3,w4 should be negative values.
Thanks, for the assistance and feedback. I am going to meet with a tax consultant this season. I was just thinking this might be useful for that visit. My apologies for the confusion!
