Following the example of the relay chain Polkadot, Equilibrium has come to the realisation that its token may require redenomination as well. There are several reasons to this:
- Convenience and ergonomy. Psychologically it is more optimal for EQ users and potential crowdloan participants to see integer amounts in the Equilibrium UI.
- Alignment of total supply with the ecosystem peers: Equilibrium doesn’t stand still and evolves constantly, we analyze our peers, their token models, their approach to crowdloan campaigns and strive to come up with the solution that eventually benefits all of our users. We’ve gathered information about all ongoing and upcoming parachain auctions and their tokenomics and have come to the conclusion that on average, Equilibrium’s total supply is 10 times smaller than what other projects offer.
- Granularity: increased supply means that Equilibrium can be more flexible in the design of its tokenomics model, increasing its maneuver potential when it comes down to splitting tokens among different allocations, for example, redenomination will allow Equilibrium to allocate higher percentage of tokens for the upcoming crowdloan campaign, which again according to extensive review of peers, amounts to 20% of the entire supply on average.
In no way do we want this process to be the sole decision of Equilibrium. That is why we propose EQ holders to participate in a wide voting process and come up with the final decision. The vote will be a simple approval voting, with the following mechanics in place
- The 3 poll options are: ‘I don’t get why to change the supply’, increase it 10-fold, or increase it 100-fold
- Any single user may vote only once and select only one option
- After the user has voted, there won’t be any chance to alter the vote
- Funds locked in staking are counted
- Funds locked in lockdrop are counted
- Accounts who don’t have EQ balances, vesting or lockdrop are excluded from voting.
- Equilibrium will not participate in voting with treasury reserves. The decision is solely in the hands of our community
EQ redenomination does not affect any economics of the platform: all rewards, fees, interest rate structure stays the same in relative terms. If redenomination option wins, all balances, vesting amounts, transaction fees, interest payments will increase accordingly, there won’t be any dilution of anyone’s share.
Are you an EQ token holder? Cast your vote here now!