Cosmos community votes to limit Atom inflation rate to 10% amidst highest-ever turnout, reducing staking yield from 19% to 13.4%

The Cosmos Hub community has approved governance proposal #848 to cut ATOM’s maximum inflation parameter from 20% to 10%, in a closely contested vote that drew the highest turnout in Cosmos Hub history. The proposal, originally introduced by Sommelier co‑founder Zaki Manian, modifies Cosmos Hub’s dynamic inflation model by lowering only the maximum inflation cap, which brings ATOM’s then‑current inflation down from roughly 14% to 10% and reduces the network’s staking yield (APR) from about 19% to 13.4%. ATOM uses an adaptive inflation schedule that targets roughly two‑thirds of the supply being staked; before the change, inflation could move between a floor of 7% and a ceiling of 20%, with higher inflation incentivizing more staking when participation fell and lower inflation when staking was already high. Backers of proposal #848 argued that Cosmos Hub was overpaying for security, that validator economics would remain viable at 10% maximum inflation (with room to adjust commissions), and that lower long‑term emissions would reduce dilution for ATOM holders. The vote was extremely tight and politically polarizing. Proposal #848 ultimately passed with around 41.1% voting YES, roughly 38–32% NO, a small share veto, and over 20% abstentions, but it also registered about 72–73% of total voting power participating, the highest turnout so far on Cosmos Hub. The outcome immediately sparked backlash from some large validators and from Cosmos co‑founder Jae Kwon, who publicly called for a hard fork dubbed AtomOne (ATOM1) that would retain a higher 20% max inflation and introduce stricter governance thresholds, with a planned airdrop favoring those who opposed the proposal. In parallel, separate proposals to further modify ATOM’s inflation parameters—such as cutting the minimum inflation from 7% to 0%—have since been debated and in at least one case rejected, underscoring that ATOM’s monetary policy and validator incentives remain an active area of contention and experimentation within the Cosmos ecosystem.

✨ AI-generated background, compiled from web sources — not editorial content.

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• Cosmos Hub Rejects ATOM Inflation Reduction Proposal - DailyCoin (dailycoin.com)
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