Developers in the Cosmos ecosystem have taken an important step and offered to reduce the minimum inflation of ATOM, the native cryptocurrency of the Cosmos network, to 0%.
The proposal was put forward on January 9 by StakeLab, a staking and transfer hub in the Cosmos ecosystem.
Currently, ATOM's inflation rate fluctuates between 7% and 20%. However, if the proposal is accepted, the inflation rate could be reduced to anywhere between 0% and 20%.
The proposal sparked a heated debate on the Cosmos community forum. StakeLab expressed particular concern regarding the previous minimum inflation rate of 7%. They pointed out that this rate means that even if 100% of the token supply was staked, the network would continue to produce additional tokens at a rate of 7% per year. StakeLab expressed concern about this situation, stating that it does not fit into any functional blockchain model.
In the proposal, the developers said that the logic behind setting the maximum inflation rate at 20% is to generously reward those who contribute to the security of the chain.
Voting will end on January 23, 2024. Currently, 86.3% of token stakers voted positively, 4.2% voted negatively, and the remaining group either vetoed or abstained. However, if a quorum of 40% does not vote, the vote will still be rejected.
*This is not investment advice.
