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Echelon is highly inflationary at the beginning, with over ~300+ million ECH being issued during the first year, 150 million minted at the start (Towards delegations, development incentives, liquidity pool incentives, and initial liquidity creation). With the initial tokenomics, new ECH will be issued under an exponential decay algorithm, where the inflation is decreased daily every one year (365 daily epochs, 365 daily rewards/decreases). The target is to issue one billion Echelon (ECH) within four years.
Inflation is added with the current breakdown below, these can be changed via onchain governance. The current inflation APR % is 133.34% as of 7/19/2022.
This is the Echelonomics reward algorithm
The current onchain set variables for the above formula are (7/19/2022):
With this reward algorithm, it makes the long term of the network deflationary, but we see Echelon as a coin with a capped or max supply. We encourage the community to propose alternative inflation models after year four (2026) with a governance proposal. The Echelon community can propose a new on-chain proposal if the rewards are deemed too low. There is a 100 active validator maximum, which will be dependent upon the amount of ECH delegated to each validator. The number of possible Echelon validators is subject to governance proposals, of which can be modified.