Cosmos (ATOM) Announces Highly Anticipated Voting: What Was The Result?

Cosmos, a decentralized network of interoperable blockchains, has rejected a proposal aimed at lowering ATOM's minimum inflation rate to zero.

The "proposal 868" submitted by Shakelab was intended to break the inflationary pressure on the token by lowering the current inflation rate.

Bonding is the process of locking up ATOM tokens in exchange for staking rewards and governance rights. According to the proposal, if more than two-thirds of the total ATOM supply is connected, the inflation rate will drop to zero, effectively creating a deflationary scenario for the token.

However, the proposal did not receive sufficient support from the Cosmos community, who expressed concerns about the negative impact of reducing the inflation rate to zero on the security and sustainability of the network.

The Hub, the central blockchain of the Cosmos ecosystem, uses ATOM for transaction fees, security, and governance. Reducing the inflation rate to zero with the proposal means reducing incentives as a result. This carries risks that could compromise the functionality and flexibility of the Hub.

The proposal was rejected by 48.6% of the approvers, who had 67.8% of the total voting power. Only 25% of validators, who had 18.4% of voting power, supported the proposal, while 25.9% of validators, who had 13.8% of voting power, abstained.

The previous proposal 848, which proposed a similar change, was passed by the Cosmos community in December 2023 and imposed a cap on the maximum inflation rate of 10% from the previous 20%.

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