Proposal to Change ASTR Tokenomics to Fixed Supply

Economics
42

I feel that the discussion is starting to lose focus, so I’d like to organize the key points once again.

Setting an upper limit on ASTR issuance has, in simple terms, the following advantages and disadvantages:

Advantages:

  • As the total supply becomes limited, this will have a positive impact on ASTR’s value.

Disadvantages:

  • In effect, this would result in a gradual phase-out of dApp Staking.
  • It could raise sustainability issues for Astar as a public blockchain.

There is no need to elaborate further on the value appreciation of ASTR under the advantages.
I will provide more detail regarding the disadvantages.

1. In effect, this would result in a gradual phase-out of dApp Staking

The proposal mainly focuses a 2–3 year timeframe, but from a long-term perspective, dApp Staking will effectively lose its functionality. In 10 years, token emissions will be about 1/8 of current levels; in 30 years, they will be almost zero.

Of course, in the near term, dApp Staking will still function and continue to provide yields to both stakers and developers.
Staker yields (%) will certainly decrease, but since emissions will also decrease, the inflation-adjusted real yield will not decline significantly at first.
For developers as well, parameters such as slots can be adjusted, and if ASTR price rises, yields can be maintained for the time being.

However, the fundamental issue is not about maintaining yields—it is the fact that dApp Staking is guaranteed to disappear in the long term.
We need to consider whether this is a positive or negative outcome for the ecosystem.
Yield levels are a minor concern in comparison.

Originally, Astar was known for various distinguishing features. Currently, dApp Staking is one of the few remaining features with any real significance.
If this is eliminated, the chain will become heavily reliant on alignment with Soneium—that is, it will become highly dependent on Startale and its business development.

This is not necessarily a bad thing in itself—if other organizations or companies, besides Startale, were to take a leading role, it could be positive.
However, given the relationship with Sony, this is likely to be difficult to achieve in the short term.

Ultimately, it comes down to the question: What is Astar aiming to become?

2. It could raise sustainability issues for Astar as a public blockchain.

Token emissions are currently distributed to the Treasury and to Collators.

Collators serve the same role as validators on typical PoS chains and are critical infrastructure for maintaining the chain.
Since Astar is a Parachain, it does not require as large a reward as a typical L1—but if these rewards are entirely removed, the number of collators will decrease significantly, reducing decentralization and increasing single points of failure.
This would undermine the core advantages of running a blockchain.

There has been talk of AFC stepping in to cover these rewards, but entrusting this responsibility to an organization that has no proven track record yet is overly optimistic.

Additionally, the Treasury is used to fund various ecosystem activities. Recently it has funded ACS, and it will also be used for Coretime purchases going forward. Coretime prices remain unstable and speculative, making future planning difficult.
AFC aims to generate revenue from Treasury management to help fund these activities, but whether this will succeed remains uncertain.
Again, it is too optimistic to rely on this at this stage.

In the end, this boils down to: Where are we placing our priorities?

Based on the current proposal, it seems the primary goal is to increase ASTR’s value.
This is not inherently a bad thing—but different community members have different priorities, which is where the current friction arises.

Perhaps Astar Evolution Phase 2 will provide a clearer vision.
This proposal may well be linked to Phase 2—but since this is not yet confirmed, we can only discuss what is currently visible.
Most likely, no firm conclusion will be reached at this time.

6 Likes
43

Thank you for organizing the discussion.
I think it might be better to discuss whether or not to put an issuance cap on Astar after the information on Astar Evolution Phase 2 is released.

2 Likes
44

This is an excellent summary, and I think hits the nail on the head with respect to some tough realities this community needs to face, which are extra hard to process when so many of us are emotionally invested in Astar due to project work and/or ASTR holdings over the years.

It seems to me that Astar has largely become a staking chain, and a marketing channel; with the primary goal of the marketing to build up a user base for Sony to tap from day 1. Soneium is the culmination of this, and now Sony has a chain with a ready made user base generating impressive looking stats. Good job Startale.

Seems pretty clear to me that everything now hinges on Startale figuring out a profitable way of building in a genuine need for ASTR into Soneium projects/eco.

Eventually the efforts to do this “for the community” will end if they just create more effort to build and don’t unlock greater profits for the builders. With ETH already native to Soneium, it feels like odds are stacked against ASTR. Perhaps the only hope is the ASTR marketcap represents some millions of dollars of capital assuming price stability, and attracting this capital is interesting to commercial enterprises.

That said, all of this “do a meaningless txn to earn a meaningless NfT/badge” activity is imo just a bunch of crap. Maybe mild entertainment for some in a very short timespan, but its not anywhere close to what is going to rescue ASTR’s value prop in the long run.

There was a great pod cast released this week with the CEO of Mythical Games where he talks a bit about the MYTH token and how they are prioritising different incentives to keep it valuable whilst also ensuring the company makes a profit. This is just one example, but as a fellow parachain on Polkadot I think it could be a good source of inspiration for those wondering what good could look like. Obviously MYTH itself is in a massive price slump at the moment, but it has a fixed supply and very practical use cases with a suite of games with real chunky user bases. FIFA mobile game launching this week too…

Are we going to see Sony tap all of its IP, including PlayStation to release web3 games/experiences that require ASTR in some meaningful way? Or are we going further down a marketing badge + yield farming circle jerk until the last diehards sell out?

4 Likes
45

Thank you @you425 for taking the time to organize the discussion — it really helps refocus the conversation.

You’re absolutely right that moving toward a fixed supply has both clear benefits and important tradeoffs. I’d like to offer a few thoughts in response, particularly on dApp Staking and the broader sustainability question.

On dApp Staking Phase-Out

Yes, this proposal implies that over the long term (10-30 years time frame), dApp Staking as we know it will gradually phase out if ASTR token price does not increase significantly. But perhaps the more important question is: Has dApp Staking truly delivered the impact we hoped for?

While it has been a flagship feature for Astar, we should ask ourselves:

  • How many high-performing or widely adopted dApps have emerged because of dApp Staking?
  • Has it meaningfully helped builders reach product-market fit?
  • Or has it, at times, incentivized participation for the sake of rewards rather than long-term value?

This isn’t to discount the value of past efforts — many builders have benefited from it. But in today’s evolving Web3 landscape, maybe it’s time we rethink how we support developers. Instead of relying solely on inflationary rewards, we can explore more targeted, performance-aligned models that drive lasting growth.

The idea isn’t to abandon support — it’s to evolve the mechanism to ensure it’s sustainable, effective, and future-proof.

On Sustainability and Public Blockchain Viability

Regarding collator rewards and treasury use: it’s a valid concern. But we should clarify that collators on Astar, as a Polkadot parachain, do not play the same role as L1 validators in securing the network — security comes from the Polkadot Relay Chain. So while incentives matter for decentralization, liveness won’t be compromised.

That said, decentralization remains important. If collator participation drops or centralization risk grows, the Astar Finance Committee (AFC) can allocate non-inflationary incentives from existing fee revenue or reserves to ensure a healthy node set.

Similarly, the treasury’s future use will need to be prudent. While Coretime prices and other variables introduce uncertainty, the proposal includes multiple non-inflationary levers (like protocol-owned liquidity and fee redirection) to strengthen long-term sustainability.

Imo, this proposal is not a rejection of what brought us here — it’s an evolution. It’s about asking honest questions, adapting to real-world conditions, and ensuring that Astar is built to thrive not just in the next cycle, but for the next decade. Thank you

4 Likes
46

Thank you for your reply, especially amidst your busy schedule.

Yes, that is absolutely right.
This point has been raised multiple times by others in the forum as well, and it shows that we need to re-evaluate the value of dApp Staking.
However, it’s important to distinguish between two different motives that could drive its removal:

  • “We want to introduce a supply cap for ASTR” → valuation-focused
  • “dApp Staking has not delivered meaningful results” → functionality-focused

These are fundamentally different purposes.
Neither is inherently better than the other, but governance participants should align on the underlying rationale before a collective decision is made.

This is precisely the uncertainty that concerns me.
If we are being realistic, we must first calculate how much revenue the AFC will need post-inflation.
The following are the currently available variables:

  1. Current Treasury balance
  2. Block rewards until inflation stops
  3. Revenue from gas fees (20%)
  4. Yield from AFC-managed assets
  5. Cost of Coretime
  6. Operational costs like collator rewards

Of these, 4 and 5 lack enough historical data to model accurately.
Still, it is possible to simulate different scenarios and identify key parameters.
If we’re going to implement a hard cap on supply, this level of due diligence should be mandatory.

If that isn’t feasible at this time, then, as I previously mentioned, we should introduce a floor to inflation.
After that, we can observe the ecosystem over the next decade (e.g., with a 0.5% inflation floor) and make decisions later.

It’s far better to add a supply cap later than to implement one now and be forced to reverse it.
However, if the community decides that a hard cap is desirable for short-term price impact, I am willing to accept that choice.

Decision-Making Framework

Ultimately, I believe our discussion needs to converge around the following two axes:

:white_check_mark:Re-evaluation of dApp Staking

  • A: Continue — Introduce a minimum inflation rate
    → What should the floor be?
  • B: Gradual phase-out — Follow the current proposal
    → Must be accompanied by a thorough sustainability assessment
  • C: Immediate termination — Remove developer rewards from inflation
    → Requires a full tokenomics redesign alongside B

:white_check_mark:Sustainability Assessment

  • A: Inflation is necessary
    → To what level should inflation be reduced, and how will dApp Staking be handled?
  • B: Fixed supply is acceptable
    → How will dApp Staking be handled?

It’s worth noting that there has been no outright opposition to reducing the inflation rate.
The two central concerns are:

  1. The purpose and future of dApp Staking
  2. The sustainability of Astar as a public blockchain

As reference, there have been examples where chains with a hard cap reissued tokens or later removed the cap:

  • Polygon: Removed the cap when transitioning from MATIC to POL
  • Cronos: Reissued CRO that was previously burned

In Polygon’s case, it largely went unnoticed.
In Cronos’s case, however, governance concerns triggered significant backlash.

In my view, a minimal level of inflation is essential for sustainability.
One potential model would be issuing tokens only for AFC operations and burning them if unused.

Alternatively, replacing dApp Staking with treasury-based grants could also be considered a viable solution.

If we cannot reach a definitive decision now, then we should set an inflation floor and revisit the issue in the future.
No one can predict what will happen years down the road.

1 Like
47

Hello @Mingshi san

This is the first time I’ve learned that you have doubts about the effectiveness of dApp Staking. Thank you.

I feel that the current Dapp Staking has the following problems.

  • There is no mechanism to track the development progress or marketing metrics of dApps.
  • Commuty Treasury and Astar Core Contributor remain Tier 1 and do not function as developer support.
  • There is no established development model flow using dapp staking for development teams or developers within a developer community that is not supported by an enterprise.

I believe that these issues are the reason why dApp staking does not run smoothly and the ecosystem does not develop.
These are not problems with dApp staking per se, but operational issues – and they are solvable.
Why give up on Dapp Staking without solving these problems and observing the results?
Even if these issues are resolved, will Dapp Staking still have no utility?

You mentioned that dApp Staking should be abolished and replaced with a new, sustainable, effective, and future-proof developer support mechanism.

What would such a system look like?

Before proposing Tokenomics 3.0, shouldn’t we first present a proof of concept (PoC) for the new approach and demonstrate that the new approach can truly surpass dApp staking as a developer support mechanism?