I’d like to raise a suggestion: should Dfinity team consider further reducing ICP inflation?
Price is shaped by the market, yes—but a stable and gradually rising ICP price would benefit the entire ecosystem. It helps build user confidence and attracts developers.
Burning via cycle top-ups is a start, but it’s not enough. We need to address inflation at its root. As far as I know, there haven’t been any major moves to reduce issuance.
This isn’t FUD. It’s a call to reflect. A healthier token economy helps us all. Let’s work together to make ICP stronger.
Inflation in relative terms (relative to deflation) has reduced massively in recent months. On average this will keep happening as long as builders keep on building and delivering value to users. This is what ICP is about
We’re well on the way. If we want to speed it along we need to find ways of better incentivising builders who can deliver real value to users. We could also do with rooting out and expelling devs who are not delivering and simply draining funds.
@borovan has been doing a great job of holding these sorts of devs to account.
Ironically, if we were to reduce rewards (i.e. reduce inflation), we would likely discourage investment and dampen developer interest. What we need most is more developers building more products, and acquiring deeper skills within this ecosystem.
If current trends continue ICP should be deflationary within a year. Also, it seems unfair to decrease rewards after people have locked their ICP for 8-years. If we lower rewards, we should allow people to unstaked their neurons as well; but if we did that we would increase the amount of ICP in circulation (pushing prices down).
Back in 2023 this seemed like a critical concern, because the price got so low it would have been possible to enter a “death spiral”. But today ICP is holding up and cycle burn is increasing. I say we wait until we need to address a specific threat.
Well inflation can be a problem or a benefit depending on other factors. Currently it’s a problem as it drives down the price as there is not enough demand for the token. If we have many successful projects it will be a benefit as it will ensure a supply of ICP is always available for voting and cycles burning.
I was sure lord of tokenomics changes will appear again soon enough and here we are with the first savior holding this well studied mask. Showing very limited understanding of a whole system and also half admitting he has no stakes in the protocol.
The trend is simple : price goes down and we have a lot of experts suddently appearing to “solve” the imaginary issue with a simple wand move. They know it better than the Dfinity foundation team that designed a robust configuration.
Here is the bottom line : Inflation isn’t an issue and changing tokenomics will just remove trust in the protocol.
