As a long-term holder of $INJ, I feel it's necessary to have a serious discussion about the IIP-617 proposal that @injective just voted through a couple of days ago.
The core of the IIP-617 proposal is just one thing: $INJ Supply Squeeze, which means permanently increasing the deflation rate of $INJ by 100%.
Many governance proposals are just minor parameter adjustments, but this time is different; this is a real upgrade that changes the monetary structure of $INJ.
$INJ is no longer just a token with a deflation mechanism; it is now an asset that actively compresses supply at the protocol level.
Let's talk about the most critical change.
The Supply Squeeze will tighten issuance parameters at the protocol level, leading to a long-term decrease in the speed at which new $INJ enters the market.
More importantly, this mechanism works in conjunction with the Community BuyBack.
One is responsible for issuing less, while the other is responsible for continuous buyback and destruction.
The Community BuyBack will start operating in October 2024 and has already accumulated the destruction of 6,870,000 $INJ.
The amount of destruction itself is already large, and combined with the decrease in issuance speed, its effect may be exponentially amplified.
In other words, a decrease in new supply + a fixed monthly rhythm of buybacks and destruction means that $INJ officially enters a long-term deflationary phase.
Observing the deflation path of $INJ is actually a continuous evolution route.
From the earliest burn auction to INJ 2.0, 3.0, and now to the Community BuyBack, this Supply Squeeze is the next step along this line.
Early on, it was about verifying the feasibility of deflation; mid-term was about expanding participation; now we begin to focus on the efficiency of the long-term monetary structure.
One point I personally value is that this upgrade does not introduce complex new mechanisms.
From the holder's perspective, the protocol utilization rate increases, and the scale of buybacks increases accordingly.
The issuance side is locked in a lower range, and supply elasticity is compressed.
Against the backdrop of @InjectiveLabsCN continuously advancing RWA, derivatives, and institutional-level applications, this deflation framework is actually crucial.
The Supply Squeeze may not immediately change the price, but it will change the direction of supply and demand evolution for $INJ in the coming years.
For long-term participants, this is more important than short-term volatility.
I prefer to view this upgrade as a fundamental adjustment.
It is locking in a more restrained monetary system for a larger-scale financial network in advance.
The core of the IIP-617 proposal is just one thing: $INJ Supply Squeeze, which means permanently increasing the deflation rate of $INJ by 100%.
Many governance proposals are just minor parameter adjustments, but this time is different; this is a real upgrade that changes the monetary structure of $INJ.
$INJ is no longer just a token with a deflation mechanism; it is now an asset that actively compresses supply at the protocol level.
Let's talk about the most critical change.
The Supply Squeeze will tighten issuance parameters at the protocol level, leading to a long-term decrease in the speed at which new $INJ enters the market.
More importantly, this mechanism works in conjunction with the Community BuyBack.
One is responsible for issuing less, while the other is responsible for continuous buyback and destruction.
The Community BuyBack will start operating in October 2024 and has already accumulated the destruction of 6,870,000 $INJ.
The amount of destruction itself is already large, and combined with the decrease in issuance speed, its effect may be exponentially amplified.
In other words, a decrease in new supply + a fixed monthly rhythm of buybacks and destruction means that $INJ officially enters a long-term deflationary phase.
Observing the deflation path of $INJ is actually a continuous evolution route.
From the earliest burn auction to INJ 2.0, 3.0, and now to the Community BuyBack, this Supply Squeeze is the next step along this line.
Early on, it was about verifying the feasibility of deflation; mid-term was about expanding participation; now we begin to focus on the efficiency of the long-term monetary structure.
One point I personally value is that this upgrade does not introduce complex new mechanisms.
From the holder's perspective, the protocol utilization rate increases, and the scale of buybacks increases accordingly.
The issuance side is locked in a lower range, and supply elasticity is compressed.
Against the backdrop of @InjectiveLabsCN continuously advancing RWA, derivatives, and institutional-level applications, this deflation framework is actually crucial.
The Supply Squeeze may not immediately change the price, but it will change the direction of supply and demand evolution for $INJ in the coming years.
For long-term participants, this is more important than short-term volatility.
I prefer to view this upgrade as a fundamental adjustment.
It is locking in a more restrained monetary system for a larger-scale financial network in advance.