The x/mint Module and understanding the Inflation Rate Calculation
CONTEXT: We have seen recently a series of on-chain proposals regarding the reform of certain inflation related parameters. We were very surprised to see among the comments a large share of users that didn’t really understood the formula behind. On this context we have provided our initial negative feedback on these proposal on this post , highlighting the fact that the logic would have guided us to discuss the inflation reform as a fully comprehensive formula debate BEFORE voting on the adjustment of certain parameters alone. The reasoning is quite simple, to vote confidently on such a critical matter of the blockchain tokenomics, we feel like the users should have been informed correctly, the most professional way to acheive this would have been to build a mathematical model to showcase the effect of each parameters and let the users play around with it to understand their influence over inflation. ANALYSIS: It is worth remembering everyone here how this formula works: ``` NextInflationRate(params Params, bondedRatio math.LegacyDec) (inflation math.LegacyDec) { inflationRateChangePerYear = (1 - bondedRatio/params.GoalBonded) * params.InflationRateChange…
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Yeah, it does feel like a lot of posters don’t understand how the inflation formula in Cosmos works. Thanks for posting this.
Is there at least one official document, whether on the official Cosmo hub website or the white paper, on the operation of this inflation/staking mechanism income, etc.? think no because nobody can explain iy
It’s public knowledge on the Cosmos SDK, the source was provided in the post:
x/mint | Explore the SDK