Governance Hub

As part of the introduction of the Staking mechanism on Starknet, STRK holders will be voting on the following:

1. The minting mechanism, as detailed in “Minting Mechanism”
2. The protocol for modifying the parameters of the minting mechanism, as detailed in “Adjustments to Minting Curve”

Minting Mechanism:

We propose the implementation of a minting curve mechanism for new STRK tokens. The minting curve is based on Professor Noam Nisan’s proposal 2, with a slight parameter variation. The minting curve is defined by the following formula:

M = C/10 * √ S

Where:

• S is the staking rate, expressed as a percentage of the total token supply.
• M is the annual minting rate, also expressed as a percentage of the total token supply.
• C is the maximum theoretical inflation rate, expressed annually as a percentage.

The initial value for C is proposed to be set at 1.6.

Implementing a minting curve mechanism allows for a dynamic adjustment of the token supply in response to staking participation rates. This approach aims to balance the incentives for staking while effectively managing inflation.

Adjustments to Minting Curve:

Either A monetary committee created by the Starknet Foundation or the Starknet Foundation will have the authority to adjust the minting curve constant C within the range of 1.0 to 4.0, subject to the following conditions:

• Lowering C: This adjustment will be made when an excessive amount of STRK is staked.
• Increasing C: This adjustment will be made if insufficient STRK is being staked.

To ensure transparency and community trust, any change to the minting curve constant C must be accompanied by:

• A public announcement detailing the justification for the change.
• The announcement must be made on the community forum at least two weeks in advance of the change.

For more details SNIP 18: Staking’s First Stage on Starknet

Please vote For, Against, or Abstain.