The NEAR ecosystem governance proposal has entered the voting stage. It proposes lowering the maximum annual issuance rate from 2.5% to 1.6% over 24 months, which is positive from a supply-side perspective and should ease dilution pressure for long-term holders. However, issuance will still continue, just at a lower rate. In the long run, we’ll have to see whether fee burns driven by real on-chain usage can consistently exceed new issuance and make the token deflationary.
I think UNI has done a pretty good job in this regard: it has linked real trading revenue to token burns, and there is currently no actual issuance. Compared with simply lowering the issuance rate, continuously burning tokens with business revenue creates a more direct link between the protocol’s growth and holders’ interests. Of course, how effective this mechanism will be ultimately depends on actual revenue and the scale of the burns.$NEAR $UNI
I think UNI has done a pretty good job in this regard: it has linked real trading revenue to token burns, and there is currently no actual issuance. Compared with simply lowering the issuance rate, continuously burning tokens with business revenue creates a more direct link between the protocol’s growth and holders’ interests. Of course, how effective this mechanism will be ultimately depends on actual revenue and the scale of the burns.$NEAR $UNI