Let’s discuss about the possibility of implementing variable inflation rates as a function of network performance or anything else for that matter.
Right now, Aion is subject to a 1% annual inflation of the total token supply from mining rewards (not sure if this includes ALL validator rewards). Regardless, I think this is a good basis for discussing where variable rates would work in this system and a base rate at which the supply should grow.
More broadly speaking, can we implement a mechanism that can either increase or decrease this base 1% rate. How beneficial would variable rates be to the system? Obviously right now we have the public TRS and founders TRS releasing tokens every month adding to the supply, so for the next 1-3 years this inflation rate will be higher.
An interesting thought would be to implement a small burn fee whenever a validator leaves the system, with respect to a time variable. For example, let’s say I’ve been staking for the past 3 months and, for whatever reason, want to withdraw my stake. It would be interesting to see a burn fee for users who withdraw their stake within X months/quarters/years. Ultimately this could be a function as time approaches closer to x, the burn fee approaches 0.
Obviously, Aion is looking to have a hybrid validator system that includes staking, mining, and reputation(?, mentioned by Matt in a recent interview) and this may not work with the latter two. However, you could implement a small universal validator ‘deposit’ that financially commits you to being a validator for x amount of time, at least to some degree.
I am kind of just rambling thoughts down that are open for discussion regarding the economics of this ecosystem, as it is rarely talked about in the forum. Really trying to build some discussion in this area so we, as a community, can propose improvements to the protocol during it’s early stages.
If you have any thoughts on either why implementing variables rates that either burn or mint tokens based on some action within the network, feel free to post it. If you want to completely shit on anything in this post, you can do that too.