- The Starknet community has endorsed a dynamic minting curve for STRK tokens.
- This minting curve adjusts the token supply based on how many users are staking.
- The Starknet Foundation holds the authority to adjust minting parameters to control inflation and rewards.
Recently, the Starknet community has successfully approved a proposal aimed at implementing a dynamic minting curve for STRK tokens, marking a critical step in balancing staking incentives and token supply.
An overwhelming 98.94% of voters were in favor of this new staking mechanism, which seeks to provide greater control over token inflation while encouraging user engagement. This initiative positions Starknet as the first prominent Ethereum Layer 2 (L2) to introduce staking capabilities.
The approved minting curve is derived from “Proposal 2” put forth by Professor Noam Nisan, with minor adjustments. It is designed to modify the minting rate based on the levels of staking participation.
James Strudwick, the executive director of the Starknet Foundation, described the proposal’s approval as a transformative milestone. The CEO of StarkWare echoed this sentiment, emphasizing that the approval grants the community tangible stakes—both in a literal and metaphorical sense—in its future.
Understanding the dynamic minting curve
The dynamic minting curve will modify the token minting rate (M) based on the staking rate (S) and a constant (C), which is set at 1.6 at the outset. This formula enables a fine-tuned token supply that adjusts according to the number of users staking, mitigating inflation during high staking levels while encouraging participation during lower engagement periods.
Moreover, the Starknet Foundation or an appointed monetary committee will oversee adjustments to the minting parameters. This includes the ability to alter the constant (C) within a range of 1.0 to 4.0, depending on staking trends.
Any modifications to the minting rates will be accompanied by public announcements and a two-week notice period for community feedback, ensuring a transparent process.
With this dynamic system implemented, Starknet aims to cultivate a more engaged community and encourage lasting participation in the network, ultimately supporting the platform’s stability and growth.
