[PRESS RELEASE – Tampa, the United States / Florida, 17th March 2022]
The DAO embraces the community’s proposal to drive mass development and adoption of the Pocket Network
Pocket Networks, a Web3 relay infrastructure middleware protocol that facilitates abundant blockchain bandwidth from a globally distributed network of 35k+ full nodes for applications in Web3, across 37 blockchains including Ethereum, Polygon, Solana, Avalanche and Harmony, announced that it is setting up a. New governance policy aimed at reducing inflation of its utility token POKT to progressively manage Pocket Network’s growth and provide permanent, fault-tolerant incentives to node runners for Web3 to continue to scale in the most distributed networks .
Pocket Network’s protocol operates as a two-way market. On one hand, infrastructure providers run nodes or access to blockchain data for connections to Ethereum, Harmony and more than 37 other blockchains. Web3 application developers, on the other hand, gain access to a robust and fault-tolerant decentralized system for querying blockchain data and provisioning nodes.
Infrastructure providers (or “node runners”) provide network efficiencies and are rewarded by earning native POKT tokens in proportion to the number of blockchain RPC calls (or “relays”) they have serviced for application developers. Meanwhile, application developers stake native POKT tokens in proportion to the number of relays needed for their applications.
The growth of the Pocket Network’s economy can be divided into three phases: a bootstrapping phase, which has just occurred, during which the service of applications was subsidized and nodes earned lucrative token incentives; a growth phase we are now entering, where bootstrapping has successfully launched the growth wheel and inflation is managed more progressively; and a maturity phase, during which application stakes are burned in proportion to the relays they use and the global supply of POKT stabilizes. The recent large-scale increase in RelA has marked the network’s transition from the bootstrapping phase to the growth phase.
“The Pocket Network’s token economics has done a great job of getting us where we want to be,” said Adam Lipowski, Chief Operations Officer, Pocket Network. “We are now transitioning from bootstrapping our network to a more progressive managed development trajectory that will allow us to scale globally. We have continued to encourage our community appropriately, as well as the increasing success of our network. A powerful system has been put in place to protect it from any unintended consequences.”
In order to address the challenges brought by inflation, Pocket DAO (Decentralized Autonomous Organization, the public governing body of the Pocket Network) approved a proposal to actively manage the inflation rate of the overall system. Called WAGMI, or “Weighted Annual Gross Maximum Inflation”, the proposal modified the current system, where for each relay a fixed multiple of 0.01 POKT tokens to the node runner by dynamic adjustment of the relay-to-token-multiplier was substituted. An annual inflation rate.
The first adjustments implemented in February targeted a 100% annual inflation rate. Subsequent adjustments will be made to the 10% reduction on a monthly basis until July 2022, when the annual inflation rate will be 50%. Once this goal is met, the DAO will be able to set new long-term targets and continue to manage inflation gradually as the Pocket Network grows increasingly relays, eventually leading to the network’s maturity phase with the planned supply-stabilization burn. Implements strategy.
“This inflation management framework provides stable rewards for node runners and our community over the long term,” said Jack Ling, Chief Governance Officer, Pocket Networks. “If daily relays were to be changed drastically in either direction, they are no longer exposed to supply shock.”
Stabilizing the supply of POKT will ensure that the decentralized ecosystem of the Pocket Network remains attractive to niche infrastructure providers currently overseeing over 35k full nodes and application developers. With this long-term stability to growth, Pocket Network can more effectively fulfill its mission of providing a fully decentralized Web3 infrastructure and increasing market share.
About Pocket Network
Pocket Networks is a blockchain data ecosystem for Web3 applications, a platform built for applications that use cost-efficient economics to coordinate and distribute large-scale data. It enables seamless and secure interaction between the blockchain and all applications. With Pocket, the use of blockchain can simply be integrated into websites, mobile apps, IoT, and more, giving developers the freedom to put blockchain-enabled applications into the “pocket” of every mainstream consumer. For more information visit pokt.network.
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