Ambiguities in Cosmos V2's economy policy concerning policy transitions and fund distribution

Conversation Tokenomics
1

Hello Cosmos Forum Network!

I’m currently conducting a stress testing exercise on the proposed changes in the V2 economy policy and have identified some areas of ambiguity in the V2 whitepaper. I’d appreciate clarification on the following:

Disclaimer: I am aware there are more proposals under review but my objective right now is to conduct two digital twins mirroring both V1 and V2 cosmos economic policy in the most precise way possible.

Economy Policy Transition:

  1. What is the security threshold required to transition from one economic policy to another?

  2. Is there a waiting period between these transitions?

    Context: The whitepaper mentions a monthly issuance decrease by 10% over 36 months, with a safety measure that reverts to the original policy if the staking rate falls below a certain threshold. During our tests, without a waiting period between policy transitions, we observed erratic behavior.

Issuance Distribution:

  1. How is the new issuance (10,000,000 in the transition phase + 300,000 in the steady phase) distributed among validators, delegators, the treasury, and the community pool?

    Context: The paper specifies the period but not the exact distributions. It seems 95% might go to validators and delegators based on the formula, with 5% for the community pool, but the treasury’s allocation isn’t clear.

Treasury vs. Community Pool:

  1. Is there a distinction between the treasury and community pool in both Cosmos V1 and V2?

    Context: I previously understood they were the same, but the V2 whitepaper includes a graphic that differentiates between them.

Thank you for your assistance!

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  1. Is there a distinction between the treasury and community pool in both Cosmos V1 and V2?Context: I previously understood they were the same, but the V2 whitepaper includes a graphic that differentiates between them.

The V1 Cosmos didn’t have a Treasury (and we still don’t). The idea of a treasury was introduced in the ATOM 2.0 paper.

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Thanks for the reply. Then, what is the role of the community pool in v1?

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Its role is to do whatever the community spend proposals say it should do. That’s not a super satisfying answer but it’s the protocol truth!

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5

Thank you! I have checked the revised proposal that Coinbase analyzed (I cannot include links in the text box)
Is there a defined description on what would be the differences between community pool and treasury ATOM 2.0?

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Not beyond what’s in the document. There was plenty of discussion about the nuances in threads on the forum here. I think if you read the discussion threads, you’ll probably be able to figure things out.