Dear Astar Community,
I am Shun Ishikawa, recently assigned to tokenomics research at the Astar Foundation. My focus is on learning from the current state and making small parameter adjustments to bring the tokenomics closer to the ideal state. It’s not about simply increasing or decreasing your dApp Staking APR—what matters is how we optimize for the ideal outcome.
Current Challenges:
- Current inflation even though the Staking Ratio is low: Our existing tokenomics structure contributes to inflation rates not adjusted to the current market conditions and ecosystem, affecting the long-term value of ASTR tokens.
- dApp Staking APR Volatility: The current design of dApp Staking leads to significant APR fluctuations as the staking ratio increases, creating uncertainty for stakers.
We would recommend to learn more about our dynamic inflation:
- Astar documentation: Tokenomics 2.0 | Welcome to Astar
- Astar blog: https://astar.network/blog/astar-tokenomics-2.0:-driving-long-term-success-and-39068
Proposed Solutions:
- Adjust BaseStakersPart: Reducing the BaseStakersPart from 25% to 10% will decrease the fixed portion of rewards, thereby lowering overall inflation.
- Increase AdjustableStakersPart: Increasing the AdjustableStakersPart from 40% to 55% will tie rewards more closely to the staking ratio, promoting a more stable APR as we approach the ideal staking ratio of 50%.
*Please make sure that the total allocation for staker rewards remains the same.
Expected Outcomes:
- Reduced Inflation in case tokens are too liquid (unstaked): These adjustments are projected to lower inflation by approximately 0.6% in case the staking ratio remains the same, enhancing the token’s value proposition.
- Stabilized APR: Aligning rewards with the staking ratio will mitigate APR volatility, providing stakers with more predictable returns.
- Improved Tokenomics: By aligning rewards with ecosystem activity, we create a more sustainable and attractive environment for both developers and stakers.
*When we realize the ideal staking ratio, the reward will remain the same as the current parameters.
Looking at the staking reward rates in this range, we see a clear pattern: many successful protocols maintain APRs between 10% and 12% while achieving healthy staking ratios above 30-50%. (Please make sure that their inflation is much higher than Astar’s.)
For example:
- Polkadot (DOT) offers 11.73% APR (Inflation is approximately 10% per annum) with a 53.83% staking ratio.
- Injective (INJ) provides 11.25% APR (Inflation is approximately 8-9% per annum) with a 57.09% staking ratio.
This aligns closely with Astar’s vision, where we aim for an optimal staking ratio of 50% while maintaining a competitive and sustainable APR.
By adjusting BaseStakersPart and AdjustableStakersPart, we ensure that as staking adoption increases, APR remains relatively stable instead of dramatically decreasing and relatively high, considering Astar’s lower inflation compared to other protocols. This will support both long-term ecosystem sustainability and staker incentives—ensuring Astar remains competitive while fostering a thriving, engaged network.
By implementing the proposed adjustments, Astar aims to offer competitive and stable staking rewards, aligning with industry standards while ensuring the long-term health of our ecosystem.
I welcome your feedback and look forward to our collective progress.
To implement these proposed dApp Staking adjustments and align Astar’s staking ratio with a sustainable APR, we will follow Astar’s governance process to ensure transparency, community alignment, and effective execution.
Past forum discussions regarding Astar tokenomics:
- Community discussion related to the introduction of Astar Tokenomics 2.0
- Astar Foundation proposal as part of Astar Collective
- Astar dApp Staking v3 Dynamic Tier Thresholds community discussion
- dApp Staking v3 initial community discussion
Best regards,
Shun Ishikawa
Astar Foundation