This article was first published on Waves Platform - Medium
In another step towards sustainability and financial stability, the community will now make major decisions affecting block rewards and coin supply.
It is time to improve Waves’ economic model, making it more balanced, democratic and self-sustaining. Speaking more broadly, it is time to make the crypto space work as a real economy, rather than effectively existing on donations.
Currently, our monetary system is essentially deflationary, since the number of issued tokens is limited. The use of a Proof of Stake consensus algorithm leads to some WAVES being withheld from circulation in full nodes. Similarly, some tokens are withheld because of leasing, and with the arrival of sidechains yet more tokens will be locked up and removed from circulation.
We recognize that there are a range of views around the role and effect of the money supply within an economy, and the desirability of changes to that supply. At present, Waves’ money supply is fixed and unalterable, centrally decided at the launch of the network. The community can develop countless applications and use cases (and we encourage them to do so!), building a thriving economy on the Waves platform. And yet, they have no control over the monetary supply that underpins that economy.
Ultimately, this may prove unsustainable. In any case, we believe it is better to decentralize monetary policy and hand responsibility for this task to the community. To these ends, we propose a functionality to enable a new approach to token issuance, in order to support transparent, collective decision-making on the best way forwards.
Block generation rewards
A major step towards the long-term sustainability of the Waves platform is the introduction of a mining reward for each generated block — the size of which is to be decided by the community. The reward is expected to boost demand for leasing WAVES, attracting ...
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Waves Platform - Medium