The signalling of upping the staking APR has not stopped undelegations and even though the APR is going up, the amount of staked XPRT is still going down.
We can wait further for the coming 5 months or when we come closer to the 20% APR, but it is safe to say that the trend has not been broken. We have to realize that APR is not the thing that attracts people to hold an asset. If it would be that simple, why would we not see every chain going up with their inflation?
Because the answer is simple; high inflation is bad for a chain. High inflation is a guarantee for sell pressure and a declining token value. Every chain who is doing serious business is considering low inflation or bringing down their inflation figures.
Note that until October 2024 we were at 17% APR at a quite stable staking ratio. A massive unbonding took place which upped the APR to even above 20%, but the staking ratio never recovered. So even at 17% we should be able to draw proper conclusions. It becomes even more interesting when you zoom out even further:
Staking ratio grew over time, while the APR dropped? That is quite a contradiction to all the people who were supporting the proposal in the first place imo.
I daresay that we will conclude that reversing the inflation reduction will be a bigger mistake than the reduction in the first place.
But it is also insanely stupid if we are going to reverse the reversion as well, because then we really signal that we don’t know what we are doing. So we just have to wait out this storm, wait until real products are launched and suffer from high inflation figures at that time. To realize that we drastically need to cut inflation to allow the price to be valued properly.
Impressive work on the charts—thank you for the detailed analysis. Based on the data, it appears that inflation and unbonding are currently not exhibiting a clear correlation. With that in mind, it seems we just have to wait for the upcoming product launches before drawing any definitive conclusions.
However, one point that remains unclear is how these new products are intended to create tangible value for XPRT. So far, there has been little to no communication around how the token is integrated into the ecosystem of these products—whether through staking, security mechanisms, or other forms of utility. Aside from being developed by the same team, the connection between XPRT and these initiatives hasn’t been clearly articulated. A deeper understanding of that relationship would be valuable moving forward.
A very good question, my understanding is that it will be fees generated from the Validators processing tx’s. Maybe @dneorej@LeonoorsCryptoman can explain hows Persistence will generate revenue and bring value to XPRT? Are there other products or services that Persistence is looking at doing that can be spoken about?
Validator Life and Crypto supports this discussion and agrees on the need to restore staking incentives and network security. We propose revisiting the discussion on a potential inflation reduction in three months to assess the impact of the changes.
Additionally, as a new validator, Life and Crypto faces challenges in the early stages and needs support. We suggest developing additional incentives for young validators or updating the existing support program to strengthen decentralization and attract more participants to the ecosystem.
Well, I’m in favor of the proposal to increase inflation back to 6.25%-12.5%. Restoring staking incentives and supporting validator economics is crucial for maintaining network security and decentralization.
The current low inflation rate has significantly reduced staking rewards, which may discourage staking participation and weaken network security. Increasing inflation to the proposed range would make XPRT staking more attractive, ensuring a strong foundation for the network’s growth.
While it’s essential to manage inflation, the current climate and the pre-mainnet stage for the new product and Babylon staking security make this proposal a necessary step. Once staking becomes more sustainable and XPRT’s utility is further developed, inflation reductions can be revisited.
We made a solid case in the linked discussion but we were ignored. Now you are seeing what we saw back then. Of course, this is after much loss of value in the XPRT token. Massive unstaking and selling. Project in decline. Validators struggling to be profitable. XPRT has not been able to execute. In the future, please give the proper weight to your informed community members and take our comments seriously and do a proper analysis on the decisions before you make them. People like @paranormal and myself were largely dismissed.
It is even harder to realize that the token price has dropped nearly 25% in the past 2 months since the proposal and for example ATOM is roughly the same value.
Can we now finally conclude this was the wrong step and have the conversations we should have?
