governance body Cosmos Herb atom
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Approved a proposal to lower the maximum inflation rate for native tokens. Atoms are about 14% to 10%.
According to the proposal, the approved changes would increase Atom’s annual staking yield from approximately 19% to approximately 13.4%.
Cosmos Hub is the central blockchain of the Cosmos Network, an interconnected blockchain ecosystem. Hub’s native token is Atom, which is used for staking, governance, and trading fees.
This proposal narrowly passed with 41.1% in favor and 38.5% against, the highest voter turnout in the history of the Cosmos ecosystem. It was expected to fail just hours before the deadline, but a surge of late votes and some reversals from the validators narrowly changed the result in its favor.
The proposal argued that Atom’s high inflation rate compared to its peers meant it was overpaying for the hub’s security. Additionally, the validator reasoned that even under 10% inflation, they would still be able to break even or make a profit.
Zero Knowledge Validator, who voted the most for this proposal, explained his support for this proposal in X’s post. He said, “Double-digit inflation is not necessary for security, will weaken the price of Atom in the long term, and discourage use of ATOM n DeFi and elsewhere in the Atom Economic Zone.”
The biggest downvote came from validator AllNodes. post In X, small validators may be harmed by changes. All nodes called The proposal is “…an abrupt, short-sighted and poorly researched idea that could cause great harm to retailers and businesses working to build, trade and validate Atom.”
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