Astar Network has announced a comprehensive update to its tokenomics, referred to as Astar Tokenomics 2.0, aiming to drive sustainable growth and improve user engagement. The detailed explanation of the changes was posted on the Astar Network forum, and here’s a summary of the key aspects:
Current Tokenomics Overview
The current tokenomics of Astar Network involves a fixed inflation rate of roughly 9.5% per year, with each block emitting 253.08 new ASTR tokens. The distribution of these tokens goes to various actors within the network, including the collator responsible for authoring the block and the on-chain treasury.
Problems Addressed
The new proposal aims to address several issues:
High & Fixed Inflation: The current fixed block reward doesn’t adjust based on network utilization or the number of dApps.
Scalable & Inclusive dApp Staking: The existing dApp staking model needs to be more dynamic and scalable.
Native & Ethereum Fee Alignment: The fees between native Substrate and Ethereum are not aligned.
High Treasury & Collator Rewards: The current allocation to the treasury and collators is considered excessive.
Proposed Solution
The proposed changes are comprehensive and include the following key aspects:
Inflation: The new inflation rate will dynamically adjust every year based on the total supply, with an estimated yearly inflation of around 5.8% if the proposed model is deployed immediately.
Treasury: A fixed rate of 5% of the yearly inflation will be assigned to the treasury.
Collators: Collators will receive 3.2% of the yearly inflation, a reduction from the current rate.
dApp Staking: The new model introduces tiers and makes the system more inclusive for new dApps.
Transaction Fees: The solution aims to align Substrate native & Ethereum fees as closely as possible.
Rent Fees: Rent fees will be reduced by a factor of 100, making on-chain storage significantly cheaper.
Summary of Changes
The main modifications include adjustments to the inflation model, dApp staking protocol, transaction fees, and rent fees. Some of the highlights include:
If TVL (Total Value Locked) is not in the ideal range, not all staking rewards will be minted.
If empty slots are present in dApp staking during a period, the rewards for that period will be burned.
Transaction fees will incur a significant burn, with 80% being burned and 20% being deposited to the collators.
The inflation rate will constantly adjust to on-chain parameters.
Next Steps
The Astar Network team has outlined the next steps, including opening up community forum discussion, sharing the implementation plan & execution, and creating comprehensive documentation.
The proposed changes are seen as progressive steps to elevate Astar’s tokenomics for a sustainable future. The adjustments are not considered final and can be modified as needed for the stability and health of the network.
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Source: https://blockchain.news/news/astar-network-publishes-tokenomics-2-0-a-new-approach-to-inflationfees,-and-dapp-staking