Proposal for Adjusting Polkadot's Inflation System: Reducing Issuance and Complexity

@coco - wrote about it here.

The number of people who are opposing the inflation reduction by @jonas simply because they ‘live off their staking rewards’ is alarming.

Polkadot has proven itself - it’s time to take the training wheels off and allow it to flourish and be used in the most ways possible - if this means losing a few wallets because the easy APY days are over - so be it.

If there is any one thing that would sway more people into voting yes on these changes is that it will make DOT a stronger use case for DOT as collateral.

This includes usage in money markets & stablecoin issuance, loans etc.

Another very overlooked piece of information - DOT is weighted at 90% collateral ratio on most major exchanges - Binance / Bybit and a Class B asset on sites like Kraken (Class A is BTC ETH USDT USDC for reference - B is quite good).

Regardless on any ones stance to ‘trading’ - making a stronger case for DOT will give incentive for these exchanges to rate DOT even higher as a use for collateral.

To put it in perspective - the top 5 exchanges do anywhere from 20 - 40 BILLION in trading volume per day and in 2021 Binance did 7 TRILLION in trading volumes.

There is a massive opportunity here for Polkadot to climb up the rank into the top used collateral assets as it is battle tested, secure and liquid.

I for one would like to live in a world of 95% collateral weighting and a Class A rating.

Personally would like to see a slightly higher reduction and further talks & action about supply caps.

We have a real chance to make DOT a very used, very investable, immensely versatile asset and we need not waste time in doing so.

J.

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