The EOS ecosystem has reached a unanimous agreement to endorse a fresh tokenomics model, promising an “epoch-making” era for EOS tokenholders and developers.
In an announcement made on May 31, EOS declared that it would transition from an inflationary token supply, where the maximum number of EOS tokens was 10 billion, to a fixed supply of 2.1 billion tokens. The EOS Network Foundation (ENF) stated that this move would help control inflation.
Furthermore, EOS has reduced its fully Diluted Value (FDV) by 80% and implemented four-year halving cycles. One additional change is the introduction of “high-yield staking rewards” with a lockup period, although the exact yields were not disclosed.
The EOS Foundation will allocate 350 million EOS tokens specifically for its RAM Market, which allows developers and users to purchase RAM (Random Access Memory) to deploy and run applications on the network.
Upon the announcement, the crypto community responded with skepticism and doubts. A pseudonymous user named Xalytics expressed confusion about what to do with the RAM news, stating, “I have been holding EOS since the ICO in 2017. I am really lost.”
In response to the news, the EOS token is currently trading at $0.80, showing virtually no change over the past 24 hours. CoinMarketCap reports that the token has declined by 21.6% since its initial launch.
The EOS ecosystem was responsible for the largest initial coin offering (ICO) in the cryptocurrency industry. In 2018, Block.one, the company behind EOS at the time, raised an enormous $4.1 billion. However, this was followed by a failure to meet ICO expectations, legal battles, and regulatory challenges.
In 2019, Block.one reached a settlement with the U.S. Securities and Exchange Commission (SEC) and paid a $24 million penalty for conducting an unregistered securities offering during its ICO.
Another legal dispute stemming from the ICO was a class-action lawsuit filed by the Crypto Assets Opportunity Fund. The lawsuit accused Block.one of several misrepresentations during its ICO, including a false promise to invest an additional $1 billion in the EOS network. In 2021, Block.one settled the suit for $27.5 million.
In an effort to regain control from Block.one, which was perceived as failing to fulfill its promises, the EOS community established its own foundation in 2021. Yves La Rose, an original block producer, took on the role of founder and CEO of the foundation.
According to La Rose, the new tokenomics represents “a monumental occasion for the EOS community.” He further stated:
EOS is a layer-1 blockchain designed to support decentralized applications. It initially positioned itself as an “Ethereum killer.”
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