EOS cryptocurrency approves new tokenomics proposal

The EOS ecosystem community has approved a new tokenomics model, signaling a “new era” for token holders and platform developers.

As announced on May 31, EOS will move from an inflationary token supply, with a maximum of 10 billion EOS, to a fixed supply of 2.1 billion tokens. According to the EOS Network Foundation (ENF), this change aims to curb inflation and stabilize the token economy.

Additionally, EOS’s Fully Diluted Value (FDV) was reduced by 80%, and four-year halving cycles were implemented. Another significant change is the introduction of locked-in “high-yield staking rewards,” although specific yields have not been disclosed.

The EOS Foundation will allocate 350 million EOS tokens to its RAM Marketplace, where developers and users can purchase RAM (Random Access Memory) to deploy and run applications on the network. This movement is seen as a way to encourage the development and use of the platform, facilitating access to the resources necessary to run dApps.

EOS Cryptocurrency

However, the crypto community reacted with skepticism and doubts. On X (formerly Twitter), pseudonymous user Xalytics expressed his uncertainty: “I’ve been holding EOS since the ICO in 2017. I’m really at a loss as to what I should do with this RAM news?”

At the time of writing, the EOS token is trading at $0.80, virtually unchanged over the last 24 hours. According to CoinMarketCap, the token has seen a 21.6% drop since its initial launch.

The EOS ecosystem was responsible for the largest initial coin offering (ICO) in the crypto industry. Block.one, the company then behind EOS, raised a massive $4.1 billion in 2018. However, the expectation created by the ICO was not met, resulting in legal battles and challenges with regulators.

In 2019, Block.one reached a settlement with the United States Securities and Exchange Commission (SEC), paying a $24 million fine for operating an unregistered securities offering during its ICO.

Other litigation

Other litigation resulting from the ICO was a class-action lawsuit filed by the Crypto Assets Opportunity Fund, which accused Block.one of several false representations during its ICO, including the unfulfilled promise to invest an additional $1 billion in the EOS network. Block.one settled the lawsuit for $27.5 million in 2021.

In 2021, the EOS community established its own foundation to regain control of Block.one, which was seen as not living up to its promises. Yves La Rose, an original block producer, took over as founder and CEO of the foundation.

According to La Rose, the new tokenomics represents “a landmark occasion for the EOS community.” He continued: “This strategic reform will not only stabilize the token economy but also encourage active participation and growth within the network.”