The community of Osmosis, the largest decentralized exchange in the Cosmos ecosystem, has accepted a proposal to change the tokenomics of the project, which reduces inflation by 50%. It is reported by The Block.
The OSMO 2.0 initiative marks the transition from the early coin distribution phase to “long-term asset sustainability.” After the reduction, the inflation rate of the native token of the platform was about 11%.
“This adjustment allows Osmosis to strike a balance between growth and stability, providing a smoother distribution of assets over time,” the protocol team said.
Representatives DEX also announced the possible introduction of a mechanism for burning platform revenues, which will lay the foundations of a deflationary model.
Osmosis management is currently discussing changing fees for liquidity pools. The offer also empowers OSMO stakers by allowing them to earn rewards for converting tokens in the protocol.
The platform developers are also implementing the concept of concentrated liquidity.
Concentrated Liquidity is coming to Osmosis!
What is Supercharged Liquidity?
Proposals #432 & #433 (implementing CL & incentives)
READ this to get up to speed!🧵👇 pic.twitter.com/6RITR3EOpK
— Stakecito (@stakecito) June 19, 2023
The decentralized exchange has a total lock-up of $126.6 million at the time of writing, according to data from DeFi Llama.
In June 2022, the Moonbeam and Osmosis project team created a cross-chain bridge between Polkadot and Cosmos.
Recall that in April 2023, the PancakeSwap DeFi protocol team proposed changing the project’s tokenomics. The initiative involves moving from the current high-inflation model of the CAKE token to emission-neutral or deflation “with real returns and utility.”
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