Astar Network Cuts Staking Rewards to Curb Inflation
Astar Network, a prominent blockchain firm, recently announced significant changes to its tokenomics aimed at mitigating inflationary pressures within its ecosystem. These adjustments follow a recent all-time low for the ASTR token.
Reduced Staking Rewards and Inflation Control
On April 18th, Astar Network lowered its base staking rewards from 25% to 10%. This move directly reduces the automatic issuance of ASTR tokens, thus curbing inflation. The company stated that this change promotes a more stable annual percentage rate (APR) for stakers, ensuring rewards remain substantial without causing excessive inflation.
Beyond lowering staking rewards, Astar implemented additional inflation-control measures. These include:
- Redirecting token emissions: Astar is now routing token emissions towards TVL-based rewards for decentralized application (DApp) staking, leading to more predictable DApp staking APRs.
- Minimum emission threshold: A new minimum token emission threshold of 2.5% has been introduced to maintain a sustainable baseline.
- Transaction fee burning: Continued burning of transaction fees further contributes to reward predictability.
These changes have already yielded positive results. The annual inflation rate has decreased from 4.86% to 4.32%, and the total ASTR tokens emitted per block have dropped from 153.95 to 136.67, representing an 11% reduction in estimated annual emissions (from 405 million to 360 million).
ASTR Token's Recent Performance
Astar Network's efforts to control inflation come at a time when its native ASTR token reached an all-time low on April 7th, trading at $0.02. This represents a significant 93.8% drop from its peak of $0.42 in January 2022. While the token experienced a rally in December 2024, reaching $0.09, its price has since declined steadily.
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