Cosmos validators reject proposal to reduce token inflation rate to 0%
|- Cosmos' proposal to decrease the token supply’s inflation rate to 0% was rejected by 48.6% of voters.
- The minimum inflation rate is currently set at 7%, which, according to proposer StakeLab, is not found on any other chain.
- Most of the votes rejecting the proposal came from validators, but 27% of them didn't vote.
A Cosmos contributor proposal to reduce the minimum net supply of tokens to zero was rejected by the community in a close vote, resulting in the status quo being maintained. This is because, generally, a higher inflation rate is seen as a way to incentivize miners, making the network more secure by increasing the cost of a potential attack.
Cosmos inflation rate remains unchanged
Cosmos proposal 868, introduced by StakeLabs in November last year, was voted out by the community, which decided not to move forward with the suggested changes. The proposal was aimed at reducing the minimum set inflation rate to 0% from the current 7%. As noted by StakeLabs, the reason behind this proposal was given as,
"While setting a maximum inflation rate is a valuable parameter for encouraging staking and ensuring network security, the primary issue lies in the proposed minimum inflation rate of 7%. This minimum rate implies that, theoretically, even if 100% of the token supply were staked, the network would continue to produce an additional 7% of tokens annually.
The proposer went on to add that this inflation rate raises concerns for the blockchain as this rule did not fall in line with that of any other functional competitive blockchain.
The voting began on January 9 and ended on January 23. 48.6% voted against, 25.1% voted in favor, and 25.9% of the voters abstained.
Voting outcome
52.67% of those who rejected the proposal were validators. Interestingly, of the 180 validators, only 131 voted, which means that about 27% of the validators did not even vote, let alone abstain.
This is an interesting development since proposals usually receive unanimous votes either in favor or against. But given there are mixed feelings about bringing Cosmos' inflation rate down to 0%, it would not be surprising if another contributor attempts to float a similar proposal.
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