Source: Cointelegraph Original: "{title}"

The blockchain company Astar Network has taken measures to adjust its tokenomics to reduce inflationary pressure within its ecosystem.

On April 18, Astar Network announced a reduction in the blockchain's base staking rewards from 25% to 10% to curb token inflation.

The company stated that this adjustment encourages the annual percentage rate (APR) for staking to trend towards a more ideal ratio, providing users with a more stable annual rate. The company indicated that this ensures rewards "remain meaningful" while avoiding excessive inflation.

Astar Network stated: "This change reduces the automatic token issuance, decreases overall inflationary pressure, while maintaining a strong incentive mechanism to encourage users to stake their ASTR tokens."

Astar Network Implements Inflation Control Mechanisms

Unlike Bitcoin's fixed total supply, the ASTR token employs a dynamic inflation model with no maximum supply cap. As the blockchain operates, it issues more tokens, increasing the supply.

The lack of a fixed supply often exerts downward pressure on the token's value over time, especially when demand for the token does not keep pace. To address this issue, Astar is introducing several new inflation control mechanisms.

In addition to lowering staking rewards, Astar has also begun to channel token issuance into a parameter that controls the total value locked (TVL) base rewards, such as decentralized application (DApp) staking. This means that the APR for DApp staking will become "more predictable," providing stability for stakers.

Astar has also introduced a new minimum token issuance threshold of 2.5% to ensure it does not exceed sustainable benchmark levels. Through ongoing transaction fee burns, Astar stated that this will also contribute to the predictability of rewards.

According to Astar, these changes have reduced its annual inflation rate from 4.86% to 4.32%. It has also decreased the number of ASTR tokens issued per block from 153.95 to 136.67. This has reduced the expected annual issuance of tokens by 11%, from 405 million to 360 million.

ASTR Token Hits All-Time Low on April 7

Astar Network's efforts to curb token inflation come as its native token recently hit an all-time low. According to CoinGecko, on April 7, the ASTR token fell to a new low of $0.02. This price is 93.8% lower than its peak three years ago, when the token reached $0.42 on January 17, 2022.

In December 2024, as the overall market rebounded, the token briefly rose to a high of $0.09. Since then, this crypto asset has continued to decline until it reached a new all-time low.

Related: Buying Bitcoin vs Buying Gold: Which is Easier for Investors?

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