Conditional, Gradual Reduction of Mint Inflation (Subject to Chain Health)

Proposals
22

isnt that the whole point of the forum to debate?

To your points …

I agree with the core caution: you can’t cut inflation and assume price improves, and LUNA’s incentives matter. That’s exactly why the proposal shouldn’t be a fixed glidepath. It should be conditional and reversible, with no price assumptions: only reduce issuance when (a) bonded ratio + validator participation are stable and (b) fees/usage are rising enough to offset lower issuance rewards. Also, “vesting ends = structurally deflationary” needs data (net supply change, not just slower growth). On increasing inflation: open to discussing, but only with evidence it won’t just amplify sell pressure IMHO

1 Like
23

Reducing inflation makes sense, but this needs to be properly thought about and modelled, based on current chain TVL (first get all TVL on to defillama), Terra Liquidity Alliance, Security Targets and also analyzing other chains how they fared with the reduction of rewards. Most chains that went with low inflation or reduced inflation had no impact on price performance / Market Cap development.

So before this should move on, a proper detailed (manual) analysis needs to be done.