# ATOM Tokenomics: Phase 1 Outcomes

**URL:** <https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146>\
**Category:** Research Workstream\
**Created:** [July 10, 2026, 4:53pm UTC](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146 "2026-07-10T16:53:04Z")\
**Posts on this page:** 13\
**Page:** 1

<div class="post-metadata">

**Author:** ![RoboMcGobo](https://yyz1.discourse-cdn.com/flex031/user_avatar/forum.cosmos.network/robomcgobo/32/5444_2.png) [@RoboMcGobo](https://forum.cosmos.network/u/RoboMcGobo)\
**Post date:** [July 10, 2026, 4:53pm UTC](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146/1 "2026-07-10T16:53:04Z")

</div>

Earlier this year, Cosmos Labs kicked off a multi-phase research process to redesign ATOM’s economic model to move ATOM toward sustainability. Following a competitive RFP process, Gauntlet was selected as the quantitative research partner for this work.

Today we’re sharing the results of Phase 1: a comprehensive, empirical analysis of ATOM sell pressure, holder behavior, and staking economics.

**Full Phase 1 Report:** [Gauntlet: ATOM Inflation and Sell Pressure Analysis](https://gauntlet.notion.site/EXT-Gauntlet-Cosmos-ATOM-Inflation-Sell-Pressure-Analysis-Final-Phase-1-Report-fdea664a132f8367835081cd00badbac)

## **Bottom line**

Phase 1 gives us the empirical foundation we needed, and it points to a more precise problem than “inflation is too high.” Gauntlet’s on-chain analysis shows that ATOM sell pressure is small relative to supply and did not accelerate, that it routes almost entirely through a handful of large holders into centralized exchanges, and that the single largest sell reaction on record came from a governance decision, not a market crash. The strategic read is that staking demand is real and sticky (staking TVL at record highs), and the community’s sensitivity to token-economic changes is itself evidence that inflation is a demand driver, not merely a cost.

To be clear: This doesn’t mean that inflation is 100% blameless. The Hub still releases the largest immediately liquid reward footprint of any major PoS chain, roughly 3.6x NEAR and 5.7x Ethereum. The right question for Phase 2 is not “how much inflation?” but “what can stakers offer the network in return for yield, and how do we better manage immediately liquid issuance without triggering the kind of repositioning Prop 848 caused?”

* * *

## **What Phase 1 established**

**Reward-driven selling is small, but Cosmos exposes more liquid reward than any peer.** Of 8.18M ATOM in rewards withdrawn over the January to March window, 42.6% reached a sell-like route in the same week, 27.7% was re-staked, and 29.7% stayed liquid but unsold. Same-week reward selling averaged only about 0.063% of supply per week and never trended higher. However, Cosmos Hub releases 0.153% of supply per week in claimed rewards, roughly 3.6x NEAR and 5.7x Ethereum. We inflate meaningfully more than our peers even if those rewards are not the dominant driver of daily selling. That finding rules out reward selling as a main driver of price, but it doesn’t rule out how issuance impacts dilution.

**Sell pressure concentrates in a few large holders, routed to CEXes.** Across every study, 95 to 98% of sell-like flow went directly to centralized-exchange deposit addresses, with Coinbase the dominant destination; DEX swaps were negligible. Roughly 44 wallets drove the majority of sell pressure over the last six months, and whales plus mega-whales accounted for about 79% of event-window selling and 51% of cohort flow. This is a large-holder, single-channel phenomenon, not broad retail panic. Net-flow analysis confirms the cohort is a net distributor (about 7.56M ATOM net, roughly 28% of gross outflow), concentrated in a handful of addresses.

One important temper on the CEX figure: a meaningful share of exchange-bound flow is not holders selling. The largest single exchange route (an Upbit validator address, about 25% of reward-route volume) is almost certainly the exchange claiming and managing its own validator commission, not customers depositing ATOM to sell. Gauntlet recommends that ongoing monitoring report a retail-adjusted view that segments out exchange-operated validator and staking addresses, so the headline gross figure is not read as purely discretionary retail selling. This adjustment changes who is selling, not how much is being issued.

**Governance, not market stress, is the biggest sell catalyst.** Prop 848 passing produced a seven-day reaction of 10.25% of supply, 21x the cohort’s baseline selling. That single governance outcome moved more supply than the FTX (2.49%) and Terra/LUNA (1.18%) collapses combined. Holders also reacted to finality, not discussion: the Prop 848 forum post drew only 0.62% of cohort outflow five weeks before the vote spiked to 10.25%. Large holders wait for a binding outcome before repositioning. This underscores why broad stakeholder alignment ahead of any on-chain proposal is non-negotiable.

* * *

## **How we are reading it**

1. **Staking demand is real and the community’s reaction proves it.** Record staking TVL and the intensity of the Prop 848 response both show that ATOM holders care deeply about the token’s economic thesis. Sensitivity is a signal of engagement, not just risk.

2. **We still have a structural reason to act.** ATOM’s liquid-reward footprint is the largest among comparable networks. Optimization is justified on structure alone, independent of how much of today’s selling is reward-sourced.

3. **CEX sell pressure is the key Phase 2 focus, and we frame it as a demand opportunity.** The concentration of flow through a small set of exchange venues is not only a leak to manage. It is also an opening to broaden where and how ATOM staking demand is sourced (for example, expanding access through additional regulated venues to dilute any single exchange’s share), turning a sell-side concentration into a more distributed, resilient demand base.

4. **The core design question is what stakers give back for yield.** Rather than paying yield for passive lockup, Phase 2 explores what stakers can provide in return: liquidity provision, attestation, intent liquidity, and other productive contributions to the network. Staking-mechanic reform, not a blunt inflation cut, is the real lever.

* * *

## **What this means for Phase 2**

Gauntlet’s proposed path is to optimize realized liquidity rather than headline emissions, and to tie any reduction to observed demand and sell-pressure conditions rather than a one-off binding cut. Some of the areas we plan to explore first as part of phase 2:

- **Dynamic, feedback-driven issuance.** A PID-controller-style mechanism (modeled on NEAR’s approach) that steps emissions down in small, continuous increments while whale and CEX-bound pressure stays at or below baseline, and eases when abnormal pressure appears. The natural trigger to cut inflation is when product demand is strong enough that dilution kicks in organically.

- **Smooth or delay reward liquidity.** Streaming rewards, delayed claim windows, stronger auto-compounding defaults, and longer-duration staking incentives, all evaluated against Claimed/Supply and Sold/Supply rather than headline inflation.

- **A Security Floor framework.** An Economic Security Ratio dashboard (cost-to-attack versus benefit-to-attack, as Gauntlet built for NEAR) so we can reduce inflation as sell pressure allows while keeping a continuous read on validator-set security.

- **Governance market-risk discipline.** Every major token-economic proposal should carry a market-risk appendix with expected abnormal-pressure ranges, whale and CEX monitoring, and staged communications timed separately for discussion and vote-finality.

The tension Phase 1 hands to Phase 2 is clear: our structural liquid-reward footprint is high and should come down, yet the largest sell reaction in ATOM’s history was the market’s response to exactly that kind of binding change. The Phase 2 mandate is to reduce the footprint without triggering that repositioning.

Phase 2 scoping is underway now. Consistent with our plans, community and validator input will come throughout the research before any idea reaches an on-chain vote, with discussion and vote-finality communications staged separately.

* * *

## **What this means for the Hub roadmap**

**This feeds the Hub roadmap directly.** Previously there was a tension: we knew inflation was attractive, but we did not know whether the Hub could retain or coexist with that model given the inferred impact of issuance. Phase 1 resolves much of that tension. It confirms that the Hub holds an asset most networks do not: a large, sticky stake base whose inflation is not a major driver of sell pressure. Staking TVL sits at record highs and held through everything short of a binding governance change, which tells us yield has a real role to play. The question this creates for the roadmap is a more productive one: what can the inflation model support?

Today, staked ATOM does a single job, securing the network, and earns a single reward, issuance. The roadmap changes that by making stake a working input to Hub products: stake that provides liquidity, attests, backs intent execution, or secures new services. Each of those is a service someone pays for, and because the stake itself delivers the service rather than only the protocol around it, stakers could hold a direct claim on that revenue. More uses for stake mean more fee streams, and those fee streams do not have to be burned against inflation to matter. They can flow to stakers as rewards that exist because the stake did something, not because the protocol issued more supply.

This is what makes adjusting inflation, or immediately liquid issuance, viable without prompting holders to exit. The point is not that product revenue must match inflation line for line, but that the reward base diversifies: security yield becomes one income stream among several rather than the only reason to stay. Phase 1 found that inflation currently acts as a demand driver, so the roadmap’s job is to evaluate how best to optimize its impact, so we can continue to leverage it as a resource, build demand drivers stronger than issuance, and pay stakers from them. We will carry this into the Hub roadmap process as a design input.

---

<div class="post-metadata">

**Author:** ![qxnico](https://yyz1.discourse-cdn.com/flex031/user_avatar/forum.cosmos.network/qxnico/32/7846_2.png) [@qxnico](https://forum.cosmos.network/u/qxnico)\
**Post date:** [July 10, 2026, 5:25pm UTC](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146/2 "2026-07-10T17:25:49Z")

</div>

Very excited to hit this milestone. We’ve been getting the most clarity on how ATOM (and its holders) behave and what kind of ideas, ecosystem, and products they can support. The insights take time but carry a super important value in truly **building with and around ATOM, and up,** instead of trying to bring products to market that figure out token relationships later.

Moreover, this means the Hub has one more resource to build around that we thought had to be massively reinvented before driving value back to the chain (stake). Overall, the system can improve, yes, and inflation/rewards can be better structured… But stake can be helpful to many use cases beyond security. Excited to develop that up further in Phase 2.

Onwards.

---

<div class="post-metadata">

**Author:** ![ValidarIOS1](https://yyz1.discourse-cdn.com/flex031/user_avatar/forum.cosmos.network/validarios1/32/9255_2.png) [@ValidarIOS1](https://forum.cosmos.network/u/ValidarIOS1)\
**Post date:** [July 10, 2026, 5:26pm UTC](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146/3 "2026-07-10T17:26:02Z")

</div>

Were there any thoughts on setting a maximum validator commission threshold of 10%?

---

<div class="post-metadata">

**Author:** ![RoboMcGobo](https://yyz1.discourse-cdn.com/flex031/user_avatar/forum.cosmos.network/robomcgobo/32/5444_2.png) [@RoboMcGobo](https://forum.cosmos.network/u/RoboMcGobo)\
**Post date:** [July 10, 2026, 5:48pm UTC](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146/4 "2026-07-10T17:48:35Z")

</div>

Whether to set a max commission is more of a question for Phase 2, but it’s not a bad idea and would address a large chunk of the CEX-related commission issues!

---

<div class="post-metadata">

**Author:** ![Cosmic\_Validator](https://yyz1.discourse-cdn.com/flex031/user_avatar/forum.cosmos.network/cosmic_validator/32/3186_2.png) [@Cosmic\_Validator](https://forum.cosmos.network/u/Cosmic_Validator)\
**Post date:** [July 11, 2026, 9:58am UTC](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146/5 "2026-07-11T09:58:25Z")

</div>

> [@RoboMcGobo](#):
>
> - Dynamic, feedback-driven issuance.

Instead, why don’t you just finish the implementation of the [VP tax](https://forum.cosmos.network/t/chips-signaling-phase-vote-power-tax/13777)? [CHIPs signaling phase: Vote Power Tax](https://forum.cosmos.network/t/chips-signaling-phase-vote-power-tax/13777) This will achieve several objectives:

-Increase decentralization over time continuously

-Improve validator set health which is a critical issue currently

-Reduce the sell pressure coming from the largest CEX validators

---

<div class="post-metadata">

**Author:** ![RoboMcGobo](https://yyz1.discourse-cdn.com/flex031/user_avatar/forum.cosmos.network/robomcgobo/32/5444_2.png) [@RoboMcGobo](https://forum.cosmos.network/u/RoboMcGobo)\
**Post date:** [July 11, 2026, 5:35pm UTC](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146/6 "2026-07-11T17:35:22Z")

</div>

This is a possibility as well! I’ve already raised to Gauntlet that this has been one of the issues that has been proposed in the past, so it’s one of the things we will likely evaluate as part of phase 2.

---

<div class="post-metadata">

**Author:** ![ValidarIOS1](https://yyz1.discourse-cdn.com/flex031/user_avatar/forum.cosmos.network/validarios1/32/9255_2.png) [@ValidarIOS1](https://forum.cosmos.network/u/ValidarIOS1)\
**Post date:** [July 12, 2026, 6:37am UTC](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146/7 "2026-07-12T06:37:07Z")

</div>

Another issue that is overlooked is the number of delegators who delegate to validators of centralized exchanges whose commissions are 20-100%… what motivates them? But I know the answer… in fact, many people are still poorly informed about how POS works… Need creating content where you need to explain to young children how it works and why delegating to some validators you don’t actually get anything…

---

<div class="post-metadata">

**Author:** ![Dominator008](https://yyz1.discourse-cdn.com/flex031/user_avatar/forum.cosmos.network/dominator008/32/7485_2.png) [@Dominator008](https://forum.cosmos.network/u/Dominator008)\
**Post date:** [July 14, 2026, 6:20pm UTC](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146/8 "2026-07-14T18:20:04Z")

</div>

# Gauntlet ATOM Sell-Pressure Report: Critical Review

## Executive conclusion

Gauntlet does not identify ATOM’s biggest economic sellers. It identifies wallets that moved ATOM toward addresses classified as exchanges, then frequently interprets that movement as sell pressure.

Independent tracing shows that the report’s largest alleged “net sellers” are overwhelmingly **Bybit, Coinbase, and Binance operational infrastructure** —not eight independent whales. Consequently, its headline conclusion that a small group of large holders distributed 7.56M ATOM is materially overstated.

## The central accounting problem

Gauntlet defines net outflow using selected outflows minus selected inflows, but excludes the enormous `other_in` category from inflows.

| Category | ATOM |
| --- | --- |
| Counted inflows | 19.6M |
| Excluded `other_in` | 141.4M |

Examples from Gauntlet’s own tables:

| Wallet | Reported net out | Excluded `other_in` |
| --- | --- | --- |
| `cosmos1t6h6ypgxs3f7ya7ferhv935rly9znt07dr303m` | 940,496 | 6,186,935 |
| `cosmos13glngydkznenff8dz8tykvcmhlu7fcsvje7dza` | 913,362 | 7,251,843 |
| `cosmos104jt09caf8rrcgpf8rnyfaj6s274ezuu2vfp76` | 696,127 | 9,509,936 |

These addresses are only “net sellers” because Gauntlet ignores their principal funding flows. Their activity is more consistent with exchange routing and settlement infrastructure than with independent holder liquidation.

## Who the alleged biggest sellers actually are

The report’s eight largest positive-net-out rows total approximately 7.58M ATOM—essentially its entire headline aggregate net outflow.

| Address | Reported net out | Best attribution | Confidence |
| --- | --- | --- | --- |
| [`cosmos1u7h53hamha4kkuld03d7a352lpshtyj2kw7fm8`](https://www.mintscan.io/cosmos/address/cosmos1u7h53hamha4kkuld03d7a352lpshtyj2kw7fm8) | 1,703,486 | Bybit operational or settlement wallet | High |
| [`cosmos1djcpm6h3wl6uc6wuc68esuhy9q90ltrg0urs27`](https://www.mintscan.io/cosmos/address/cosmos1djcpm6h3wl6uc6wuc68esuhy9q90ltrg0urs27) | 1,491,863 | Coinbase/CEX consolidation router | High for CEX; medium-high for Coinbase |
| [`cosmos1t6h6ypgxs3f7ya7ferhv935rly9znt07dr303m`](https://www.mintscan.io/cosmos/address/cosmos1t6h6ypgxs3f7ya7ferhv935rly9znt07dr303m) | 940,496 | Bybit operational wallet | High |
| [`cosmos13glngydkznenff8dz8tykvcmhlu7fcsvje7dza`](https://www.mintscan.io/cosmos/address/cosmos13glngydkznenff8dz8tykvcmhlu7fcsvje7dza) | 913,362 | Bybit-linked operational wallet | High |
| [`cosmos104jt09caf8rrcgpf8rnyfaj6s274ezuu2vfp76`](https://www.mintscan.io/cosmos/address/cosmos104jt09caf8rrcgpf8rnyfaj6s274ezuu2vfp76) | 696,127 | Bybit-linked operational wallet | High |
| [`cosmos18ld4633yswcyjdklej3att6aw93nhlf7ce4v8u`](https://www.mintscan.io/cosmos/address/cosmos18ld4633yswcyjdklej3att6aw93nhlf7ce4v8u) | 652,190 | Binance-1 | Very high |
| [`cosmos10clzsllyngem5jyz3dpqsxu2x0p5533j7937yw`](https://www.mintscan.io/cosmos/address/cosmos10clzsllyngem5jyz3dpqsxu2x0p5533j7937yw) | 598,933 | Bybit-labeled settlement route; initially Binance-funded | Medium-high |
| [`cosmos1gwyv83zcnckdhuz3n78rvyzj59u8x6l8dk9cfy`](https://www.mintscan.io/cosmos/address/cosmos1gwyv83zcnckdhuz3n78rvyzj59u8x6l8dk9cfy) | 585,043 | Binance-3 | Very high |

Grouped by probable operator:

| Probable operator | Reported net out | Share of top-eight total |
| --- | --- | --- |
| Bybit-linked infrastructure | 4,852,404 | 64.0% |
| Coinbase/CEX consolidation | 1,491,863 | 19.7% |
| Binance infrastructure | 1,237,233 | 16.3% |
| **Total** | **7,581,500** | **100.0%** |

This is exchange plumbing presented as a holder-seller ranking.

## Address-mapping evidence

### Bybit cluster

- `cosmos1u7h...` was initially funded by Range-labeled `bybit-1-10clzs`.
- `cosmos1t6h...` was funded by `cosmos1m395...`.
- `cosmos1m395...` was itself funded directly by **Bybit Reserves 68**.
- `cosmos13gln...` and `cosmos104jt...` share the same upstream controller and transfer routes.
- `cosmos10cl...` is Range-labeled `bybit-1-10clzs` and routes downstream toward Bybit reserves, although its initial funding came from Binance infrastructure.

### Coinbase/CEX cluster

`cosmos1djc...` receives large transfers from exchange-labeled `cex-cosmoshub-1`, `cex-cosmoshub-10`, and `cex-cosmoshub-11`, then sends funds back to the same exchange family. Gauntlet identifies the `cex-cosmoshub-1` address family as Coinbase in its own tables.

That makes `cosmos1djc...` much more likely to be an internal consolidation wallet than a beneficial customer selling 1.49M ATOM.

### Binance cluster

- `cosmos18ld...` is Range-labeled `binance-1` and funded by `binance-2`.
- `cosmos1gwy...` is Range-labeled `binance-3` and funded by `binance-2`.
- Other addresses printed elsewhere in the report, including `cosmos1u5we...` and `cosmos1aasr...`, also connect directly to the same Binance infrastructure.

## Classification and data-quality failures

Gauntlet says it excluded six known exchange or treasury wallets, but the exclusions were incomplete.

| Published classification | Corrected interpretation |
| --- | --- |
| `cosmos1jr9...` shown as unclassified HNW/small fund | Range labels the corrected address `cex-cosmoshub-10` |
| `cosmos13dd5...` shown among unclassified contributors | Range labels it `cex-cosmoshub-11` |
| Several top net sellers treated as separate wallets | They share exchange-controlled upstream wallets and routes |
| Exchange-bound transfer treated as sell-like flow | No executed trade is demonstrated |

The report also publishes at least two malformed addresses:

| Published address | Correct address | Problem |
| --- | --- | --- |
| `cosmos17kvaezjckzpkct78yealre3ms2gu28cdmtwsv7` | `cosmos17kvae2jckzpkct78yealre3ms2gu28cdmtwsv7` | `z` was substituted for `2`, producing an invalid checksum |
| `cosmos1jr9vwrjtv2z4nkngzuOyrmw9gfxj0n97uy9hkt` | `cosmos1jr9vwrjtv2z4nkngzu0yrmw9gfxj0n97uy9hkt` | Uppercase `O` was substituted for zero |

These errors matter because malformed or stale addresses can prevent entity labels from matching, allowing exchange infrastructure to leak into supposedly unclassified holder cohorts.

## What the methodology cannot prove

A transfer to an exchange does not establish an executed sale. It can represent:

- Internal exchange consolidation
- Customer deposits that remain unsold
- Custody or staking operations
- Market-maker inventory
- OTC settlement
- Collateral movements
- Transfers between exchanges

Gauntlet cannot see what happens inside Coinbase, Binance, or Bybit. It therefore cannot identify the beneficial seller, execution price, executed quantity, or whether a sale occurred at all.

The analysis measures **exchange-bound routing** , not realized sell pressure.

## The Prop 848 claim is overstated

The report attributes 9.99M weighted ATOM of movement to Prop 848 and describes it as 10.25% “of supply.”

That percentage is relative to a reconstructed top-95% liquid cohort, not total circulating ATOM. A seven-day event window also establishes temporal correlation, not causation. It does not prove that every exchange transfer during the window was a discretionary sale caused by the proposal.

Prop 848 plausibly prompted repositioning, but the report does not prove the magnitude implied by its headline.

## What is missing from the analysis

The report cannot fully explain ATOM’s market price because it omits:

- Actual centralized-exchange executions and order books
- Exchange withdrawals and purchases
- OTC trades
- Derivatives and short positioning
- Market-maker liquidity
- Cross-chain trading outside the classified routes
- Reliable entity-level wallet clustering
- Demand, bids, and market depth

Price is determined by net order imbalance and available liquidity—not by gross deposits to exchange-associated addresses.

## Verdict

Gauntlet’s useful finding is narrow: **observable ATOM routing is heavily concentrated around centralized exchanges.**

Its stronger conclusions are unsupported:

- It did not identify 44 independent sellers.
- It did not prove that 7.56M ATOM was sold.
- Its largest seller rows are dominated by exchange infrastructure.
- Its net-flow calculation excludes 141.4M ATOM of inbound activity.
- It confuses addresses with entities and transfers with executions.

The defensible conclusion is:

> A few exchanges dominate observable ATOM routing, while the identities of the actual sellers—and the amount truly sold—remain unknown.

## Sources

- [Gauntlet: ATOM Inflation and Sell-Pressure Analysis](https://gauntlet.notion.site/EXT-Gauntlet-Cosmos-ATOM-Inflation-Sell-Pressure-Analysis-Final-Phase-1-Report-fdea664a132f8367835081cd00badbac)
- [Cosmos Hub: ATOM Tokenomics Phase 1 Outcomes](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146)
- [Cosmos Hub Proposal 848](https://cosmos.explorers.guru/proposal/848)
- [Range attribution: `cosmos1u7h...`](https://api-app.range.org/api/public/address/details?network=cosmoshub-4&address=cosmos1u7h53hamha4kkuld03d7a352lpshtyj2kw7fm8)
- [Range attribution: `cosmos18ld...`](https://api-app.range.org/api/public/address/details?network=cosmoshub-4&address=cosmos18ld4633yswcyjdklej3att6aw93nhlf7ce4v8u)
- [Range attribution: `cosmos1gwy...`](https://api-app.range.org/api/public/address/details?network=cosmoshub-4&address=cosmos1gwyv83zcnckdhuz3n78rvyzj59u8x6l8dk9cfy)

---

<div class="post-metadata">

**Author:** ![Dominator008](https://yyz1.discourse-cdn.com/flex031/user_avatar/forum.cosmos.network/dominator008/32/7485_2.png) [@Dominator008](https://forum.cosmos.network/u/Dominator008)\
**Post date:** [July 15, 2026, 8:57pm UTC](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146/9 "2026-07-15T20:57:28Z")

</div>

# ATOM Genesis Holders: Selling and Distribution Analysis

**Analysis date:** 2026-07-16  
**Bedrock snapshot:** 2026-07-09

## Executive conclusion

Bedrock’s headline that **208.74M ATOM, or 88.4% of genesis supply, “left the original wallet” is not a measure of selling**. It combines sales with wallet migrations, custody changes, staking operations, grants, payroll, OTC transfers, and transfers to successor multisigs. Bedrock also states that it has not indexed the full 2019–2021 transaction history, which prevents it from following most of the largest exits.

The strongest current evidence of systematic selling comes from two genesis survivors—not the fully drained wallets:

| Entity / wallet | Genesis ATOM | Current original-wallet holding | 2026 rewards received | 2026 forwarded out | Interpretation |
| --- | --- | --- | --- | --- | --- |
| Dokia Capital — `cosmos14lultfckehtszvzw4ehu0apvsr77afvyhgqhwh` | 10.00M | 9.42M | 1,164,362 | 1,165,000 | High-confidence systematic reward liquidation/off-ramping |
| Unidentified whale — `cosmos1dtq0y9reqst7d99fd3c7x6dflh4eazm4ha8qqh` | 9.05M | 6.42M | 654,860 | 655,500 | High-confidence systematic reward liquidation/off-ramping |
| iqlusion — `cosmos1grgelyng2v6v3t8z87wu3sxgt9m5s03xvslewd` | 1.47M | 1.55M | 283,129 | 100,000 | Partial reward realization; still a net accumulator since genesis |
| All in Bits successor — `cosmos15hmqrc245kryaehxlch7scl9d9znxa58qkpjet` | Successor to a 21.84M allocation | About 9.29M | No meaningful 2026 activity found | 0 | Major historical distributor, not a current-window dumper |

“Forwarded out” is not synonymous with an executed spot sale. It is nevertheless a materially stronger sell signal when reward withdrawal is followed almost immediately by transfer through consolidation wallets and into exchange-connected routing.

## What Bedrock actually establishes

| Bedrock metric | ATOM | Share of genesis supply | What it means |
| --- | --- | --- | --- |
| Staked by original wallets | 24.53M | 10.4% | Still delegated from the 2019 address |
| Liquid in original wallets | 2.93M | 1.2% | Still liquid at the original address |
| Left original wallet | 208.74M | 88.4% | Destination and economic purpose are generally unknown |

Only **27.46M ATOM remains at the original genesis addresses** , but ownership can persist after an address migration. The result is an address-retention statistic, not an owner-retention or sell-pressure statistic.

Bedrock’s twelve largest fully drained addresses held 79.8M ATOM at genesis. Two are known ICF genesis wallets and the largest is associated with the All in Bits allocation. Treating all 79.8M as sold would be incorrect.

## The strongest identifiable seller: Dokia Capital

### Address chain

| Role | Address |
| --- | --- |
| Dokia Capital genesis/validator account | `cosmos14lultfckehtszvzw4ehu0apvsr77afvyhgqhwh` |
| First-hop payout wallet | `cosmos1kldt9hgp5pzyk8t68vrwnau7846uthx7j4r9np` |
| Shared consolidation wallet | `cosmos1tmdx55nrvpw6d8p0fc29plq2gphuyxg5rp4t8j` |
| Downstream labeled CEX route | `cosmos1g6uycr7d3ky6t5f5sjh2nfzd26p49hskyc4a2h` (`cex-cosmoshub-13`) |
| Additional downstream CEX route | `cosmos1t5u0jfg3ljsjrh2m9e47d4ny2hea7eehxrzdgd` (`cex-cosmoshub-1`) |

From January 1 through July 16, 2026:

- The Dokia account received approximately **1.164M ATOM** from the distribution module.
- It made **19 transfers totaling 1.165M ATOM** to its first-hop payout wallet.
- Transfers occurred in repeated 30k–100k batches, normally shortly after reward withdrawal.
- The first-hop wallet forwarded nearly identical amounts into a shared consolidation route.
- The consolidation route sent at least **259,875 ATOM directly to a Range-labeled CEX address** , with another route eventually reaching a `cex-cosmoshub-1` address.

The near one-for-one match between rewards realized and funds forwarded is compelling evidence that Dokia monetizes essentially all current staking rewards. It does **not** appear to be aggressively liquidating its remaining 9.42M principal: Bedrock shows 94% of the original allocation still held and fully staked.

The economically accurate description is therefore:

> Dokia is a large, systematic seller of staking income, not currently a major principal dumper.

## The unidentified 9.05M-genesis whale

### Address chain

| Role | Address |
| --- | --- |
| Genesis whale | `cosmos1dtq0y9reqst7d99fd3c7x6dflh4eazm4ha8qqh` |
| First-hop payout wallet | `cosmos1dwvjk8rt86whefzdqz0d8fp5egkr0l2aywh88j` |
| Shared consolidation wallet | `cosmos1tmdx55nrvpw6d8p0fc29plq2gphuyxg5rp4t8j` |

This wallet exhibits almost the same pattern as Dokia:

- Approximately **654,860 ATOM** of 2026 distribution-module receipts.
- Approximately **655,500 ATOM** forwarded out.
- Repeated withdrawals and payouts on many of the exact same dates as Dokia.
- Funds ultimately merge into the same consolidation wallet used by Dokia’s payout chain.

This strongly suggests a shared custodian, staking operator, treasury process, or automated off-ramp. It does not prove common beneficial ownership. The wallet has retained 6.42M of its original 9.05M ATOM and remains fully staked, so its current behavior also looks like reward liquidation rather than a principal exit.

No defensible public owner mapping was found. Naming a VC would be speculation.

## iqlusion: partial seller, long-term accumulator

The iqlusion genesis wallet is publicly attributable through its validator and governance identity:

`cosmos1grgelyng2v6v3t8z87wu3sxgt9m5s03xvslewd`

It received approximately **283,129 ATOM** from rewards and commission in 2026 and transferred **100,000 ATOM** to `cosmos1a9l0han6ju5d2flwkgdud40jr7j7uwmuq65fqa`. Most of that was subsequently bridged toward Osmosis.

That is consistent with realizing roughly 35% of current rewards, although a bridge transfer alone does not prove a sale. Bedrock shows the wallet grew from 1.47M at genesis to 1.55M and remains mostly staked. It is therefore not accurately described as a long-term dumper.

## All in Bits: largest named historical distributor

| Role | Address | Amount / status |
| --- | --- | --- |
| Genesis allocation | `cosmos176m2p8l3fps3dal7h8gf9jvrv98tu3rqfdht86` | 21.84M at genesis; now empty |
| Reported successor wallet | `cosmos15hmqrc245kryaehxlch7scl9d9znxa58qkpjet` | About 9.29M currently |

The public successor mapping makes All in Bits the largest identifiable historical distributor in the Bedrock exit table. Roughly 12.5M fewer ATOM remain in the known successor than were present in the original allocation, before accounting for rewards and any other undiscovered controlled wallets.

That difference cannot all be labeled market sales. It can include employee compensation, grants, company expenses, investments, internal transfers, OTC transactions, and additional successor wallets. The cited successor wallet showed no meaningful outbound activity during the 2026 sample, so All in Bits is **not** the major current seller in this analysis.

## Interchain Foundation: migration and deployment, not a 2026 dump

| Role | Address |
| --- | --- |
| ICF genesis wallet | `cosmos1z8mzakma7vnaajysmtkwt4wgjqr2m84tzvyfkz` |
| ICF genesis wallet | `cosmos1unc788q8md2jymsns24eyhua58palg5kc7cstv` |
| ICF successor | `cosmos1sufkm72dw7ua9crpfhhp0dqpyuggtlhdse98e7` |
| ICF successor | `cosmos1z6czaavlk6kjd48rpf58kqqw9ssad2uaxnazgl` |

The two empty genesis addresses account for approximately 20.27M of Bedrock’s “exited” total, but the funds migrated to known successor wallets.

Those successors moved approximately 15.1M ATOM during March 2026. Following the next hops shows consolidation, re-delegation, grants, and treasury deployment rather than a 15.1M exchange dump. Approximately 518k ATOM reached a Range-labeled Messari address through the ICF transaction chain by May 31, but a grant or delegation transfer is not evidence of a market sale.

## Biggest anonymous historical exits

| Genesis address | Genesis ATOM | Current original-wallet balance | Attribution |
| --- | --- | --- | --- |
| `cosmos10yp5yw0rz2j7khfgmgwzs4fe4tsg72nge4f0ml` | 10.83M | 0 | Unknown |
| `cosmos1ajhsgsx3hs2ph5wcfmus539hrsset7vam8vw6r` | 10.02M | 0 | Unknown |
| `cosmos16kwean73rups2kl9t7dnmfwukvww52peduale7` | 2.90M | 0 | Unknown |
| `cosmos1zded29cyakc0t9s5thjkm8404g3vesf4au43aw` | 2.80M | 0 | Unknown |
| `cosmos1l7knghep9aerjsj6z76wcn2up5p5m6r2quhrcs` | 2.50M | 0 | Unknown |

These are the most interesting candidates for early-investor or lead-donor distribution, but Bedrock cannot tell whether they sold, migrated, or transferred custody. The Cosmos allocation described only broad groups—75% fundraiser donors, 5% lead donors, 10% the Cosmos Network Foundation, and 10% All in Bits—and does not provide a defensible public VC name for each donor address.

## Final ranking

| Rank | Seller candidate | Confidence | Actual finding |
| --- | --- | --- | --- |
| 1 | Dokia Capital | High | Liquidates approximately 100% of current staking rewards; principal mostly retained |
| 2 | Unidentified 9.05M-genesis whale | High for behavior; low for identity | Liquidates approximately 100% of current staking rewards through the same downstream route as Dokia |
| 3 | iqlusion | Medium | Realized/bridged about 100k, roughly 35% of 2026 rewards; remains a long-term net accumulator |
| 4 | All in Bits | Medium for historical distribution | Largest named historical reduction, but no meaningful 2026 selling found |
| 5 | Interchain Foundation | Low as a seller | Large migrations and deployments are visible; wholesale market dumping is not |

## Bottom line

The genesis data improves the Gauntlet analysis in one important way: it reveals **beneficial-holder behavior at long-lived wallets** rather than confusing exchange infrastructure with sellers.

The clearest recurring institutional sell pressure is generated by **staking rewards** , particularly Dokia and the unidentified 9.05M-genesis whale. Their combined 2026 reward liquidation is approximately **1.82M ATOM through July 16**. Their principal stakes remain large and mostly intact.

Bedrock does not solve the historical attribution problem. Until its cosmoshub-1/2/3 backfill is complete, its 208.74M “left the wallet” figure cannot be used to quantify sales or name the biggest historical sellers.

## Sources

- [Bedrock: The 984 ATOM genesis holders](https://bedrock.silknodes.io/atom/genesis)
- [Cosmos whitepaper: initial distribution](https://github.com/cosmos/cosmos/blob/master/WHITEPAPER.md)
- [Cosmos Hub forum: ICF and All in Bits successor-wallet mappings](https://forum.cosmos.network/t/resovled-stop-all-funding-to-icf/14277/3)
- [Cosmos Hub forum: ICF wallet addresses](https://forum.cosmos.network/t/interchain-foundation-wallet-addresses/10426)
- [Dokia Capital validator mapping](https://cosmos.valopers.com/validators/cosmosvaloper14lultfckehtszvzw4ehu0apvsr77afvyju5zzy)
- [Range transactions: Dokia Capital](https://api-app.range.org/api/public/address/transactions?network=cosmoshub-4&address=cosmos14lultfckehtszvzw4ehu0apvsr77afvyhgqhwh&start_time=2026-01-01T00%3A00%3A00Z&end_time=2026-07-17T00%3A00%3A00Z)
- [Range transactions: unidentified 9.05M-genesis whale](https://api-app.range.org/api/public/address/transactions?network=cosmoshub-4&address=cosmos1dtq0y9reqst7d99fd3c7x6dflh4eazm4ha8qqh&start_time=2026-01-01T00%3A00%3A00Z&end_time=2026-07-17T00%3A00%3A00Z)
- [Range transactions: iqlusion](https://api-app.range.org/api/public/address/transactions?network=cosmoshub-4&address=cosmos1grgelyng2v6v3t8z87wu3sxgt9m5s03xvslewd&start_time=2026-01-01T00%3A00%3A00Z&end_time=2026-07-17T00%3A00%3A00Z)

## Methodology and limitations

- Amounts were reconstructed from Cosmos Hub transaction messages and Range transaction data.
- A Range parsing inconsistency around fee-market transactions sometimes displays raw `uatom` as ATOM. Those anomalous values were checked against the underlying Cosmos transaction and divided by 1,000,000 where required.
- Reward liquidation means rewards were withdrawn and forwarded into liquid or exchange-connected routes. It does not prove the final execution venue, price, or trade size.
- Owner mappings are reported only where supported by validator identity or public wallet documentation.
- Transfers to Osmosis, a custodian, or a centralized exchange are not automatically sales.

---

<div class="post-metadata">

**Author:** ![mariashaikh](https://yyz1.discourse-cdn.com/flex031/user_avatar/forum.cosmos.network/mariashaikh/32/9278_2.png) [@mariashaikh](https://forum.cosmos.network/u/mariashaikh)\
**Post date:** [July 17, 2026, 6:14pm UTC](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146/10 "2026-07-17T18:14:13Z")

</div>

## Summary

Quick intro: I’m a Data Scientist on the research team at Gauntlet and contributed to the development of this report. We appreciate the depth of the review - it engages seriously with the analysis, and on several points it restates limitations the report already documents, which we take as confirmation that the methodology was framed honestly. We address every claim below, but want to flag one framing correction up front, because it recurs throughout the review: the report never claimed to prove executed spot sales. It measures likelihood-weighted, on-chain routing to exchange-associated addresses, explicitly labeled as a directional indicator of market-facing pressure. Read against that stated scope, most of the review’s stronger conclusions and the report’s own conclusions are closer than the review suggests.

## Points we agree with

- **Two rendered addresses were malformed.** The review is correct that the published document contained two typographical corruptions: a `z` for `2` in the Bybit Reserves 68 address, and an uppercase `O` for `0` in one HNW address. These were display-layer transcription errors that never touched the underlying analysis, and both are now corrected - we are grateful for the catch.
- **A transfer to an exchange is not proof of an executed sale.** We agree, and the report states this directly - in the methodology (“a directional, behaviorally grounded sell-pressure indicator”), in the net-flow section, and in the limitations (“All sell-pressure figures are attribution estimates of on-chain routing, not direct observation of executed off-chain market sells”). The review’s list of alternative explanations (consolidation, custody, market-making, OTC settlement) is the same set of caveats the report already carries. This is not a point of disagreement.
- **The `other_in` stream is large and material.** The report does not hide this - it devotes a dedicated section (“The central judgment call: the 141.4M other\_in stream”) to exactly the point the review raises, quantifies it at 141.4M ATOM, shows a sensitivity table of which wallets would flip if it were counted, and explicitly recommends spot-checking those senders before treating any single wallet as a distributor. We agree it is the single most important interpretive caveat in the net-flow work, which is why it was surfaced prominently.

## Where the data resolves the question

1. **The malformed addresses did not affect the analysis - the model ran on the correct, checksum-valid addresses.** This is verifiable and we have verified it. The corruption existed only in the rendered document, not in the pipeline. Scanning all 110 source CSVs in the analysis run:

2. **Aggregate net-flow figures reproduce exactly from source.** Independent re-aggregation of the net-flow dataset returns the reported figures to the digit: total out 27,124,539 ATOM, total in (counted) 19,560,883 ATOM, aggregate net 7,563,655 ATOM, split 25 net sellers / 19 net accumulators, and `other_in` totaling 141,431,329 ATOM. The arithmetic underlying the headline is sound and checkable.

## Where the disagreement is interpretive

1. **The flagged wallets were unlabeled after a deliberate attribution process, not missed.** Entity labeling was part of our mandate, and we treated it as such: we attributed every address the available evidence would support, combining a curated label set with public attribution and on-chain analysis, and we deliberately held unconfirmed addresses as “unclassified” rather than assigning an operator we could not stand behind. The two wallets the review names (`cosmos1jr9…` and `cosmos13dd…`) fall in that unconfirmed set - they carry no exchange attribution we could verify to that standard, so we labeled them by balance tier and marked them unclassified. That is a conservative labeling decision, not a label that failed to attach.

2. **On the eight “largest sellers” attribution.** This does not overturn the report, for two reasons. First, the report already flagged the router pattern on these wallets: seven of the eight appear in its `other_in` sensitivity table, with the text warning that a wallet sending ~600K to a CEX while receiving ~11M from unlabeled sources is likely a router, not a seller. The review is restating our own caveat. Second, on the two wallets it leads with (its highest-confidence, highest-value calls), the data does not support the claim: `cosmos1djc…` (“Coinbase consolidation, high confidence”) has just 34,480 ATOM of unlabeled inbound against 1.49M out, so the consolidation read is the weakest of the eight, not the strongest; and `cosmos1u7h…` (1.70M, the review’s largest) has inbound roughly equal to outflow, consistent with either reading. Its evidence in both cases is upstream-funding clustering, which is directional, not proof of exchange operation. Either way the finding holds: sell-routing is concentrated in a few high-throughput addresses, whether holders or exchange rails, and that is the decision-relevant result. Confirmed exchange wallets belong in the exchange-segmented view the report already recommends, reported as a holder-only and a total figure side by side.

3. **On CEX-to-CEX movement.** The review’s underlying principle is correct, and we agree with it: ATOM moving between an exchange’s own wallets is internal plumbing, not a holder selling, and it should not be counted as market-facing pressure. Its example is `cosmos1djc…`, which the review reads as a Coinbase consolidation wallet, receiving from the `cex-cosmoshub` family and sending back to it.

4. **On the data the analysis doesn’t include.** The review lists eight categories the report omits. It is worth being clear about why those items are absent: six of the eight are not available to us, to the reviewer, or to any on-chain analyst. They are off-chain data that live inside exchanges and private venues and are not observable on-chain by anyone. The reviewer’s own tracing is entirely on-chain and runs into the same wall. Listing them as gaps describes the boundary of on-chain analysis in general, not a shortcoming specific to this report, which is exactly why the report states plainly that its figures are estimates of on-chain routing, not observations of executed off-chain sales.

5. **The report already distinguishes routing concentration from beneficial-seller identification.** The review’s core concern - that concentrated routing to exchanges is not the same as a small number of beneficial holders selling - is a distinction the report itself draws. It classifies wallets into likely distributors, potential routers, and accumulators; flags the router pattern explicitly and states that address-level interpretation should not label every positive-net wallet as discretionary selling until `other_in` senders are checked. The concentration finding - that observable ATOM sell-routing is dominated by a small set of exchange-bound rails - is one the review also endorses. On this, the report and the review agree.

6. **On Prop 848.** The report labels the 10.25% figure as a share of the event’s top-95% liquid cohort - the metric name in every table is “% of token supply” computed on that cohort, and the methodology note states this explicitly and flags that the cohort/supply equivalence is looser for the older 2022 events. The report also states plainly that a 7-day window establishes repositioning around the event, and frames all event figures as attribution estimates rather than proof that every transfer was a discretionary sale caused by the proposal. The finding - that a binding governance outcome produced the largest normalized reaction in the set - stands on the cross-event ranking, which is robust to the cohort-vs-supply denominator because it is applied consistently across all seven events.

## What we are not claiming

To be precise about scope, so there is no ambiguity:

- We do **not** claim to observe executed spot sales, execution prices, or realized quantities. On-chain routing is the best available proxy; it is not exchange-internal ground truth.
- We do **not** claim to fully explain ATOM’s market price. Price is set by order-book imbalance and liquidity, which are off-chain and outside the dataset. The report addresses supply-side, on-chain, market-facing flow - one input to price, not the whole.

## What the analysis does establish

- Observable ATOM sell-routing is heavily concentrated in centralized-exchange rails - a finding the review independently endorses.
- The concentration finding survives the entire critique. The review disputes what the top wallets are - it does not dispute that a small number of addresses carry the large majority of observable sell-routing. Whether they are large holders or exchange infrastructure, monitoring the same short list captures the same flow - so the operational conclusion stands untouched.
- Inflation is not equivalent to selling: most withdrawn rewards are re-staked or held, while Cosmos’s liquid-reward footprint per unit of supply is structurally larger than peers’.
- Governance finality, not market-wide shocks, produced the largest normalized event reaction in the observed set.

These conclusions are consistent with the review’s own defensible conclusion. The remaining distance is largely about how prominently to foreground caveats the report already contains, and about reconciling two entity-label sources which we are glad to take up.

**On the review’s two verdict statements specifically** , to leave no ambiguity: we did not claim to have identified 44 independent sellers - the 44 are the top-outflow addresses, some of which are plausibly exchange-operated, which is why the report segments them into distributors, routers, and accumulators rather than presenting them as 44 discrete holders. And we did not claim that 7.56M ATOM was executed as spot sales - 7.56M is counted net on-chain outflow, which the report explicitly frames as an upper bound on distribution, not realized selling. On both points the review restates limits the report already states, and we are glad to make that framing even more prominent in the next revision.

---

<div class="post-metadata">

**Author:** ![bush888us](https://yyz1.discourse-cdn.com/flex031/user_avatar/forum.cosmos.network/bush888us/32/9319_2.png) [@bush888us](https://forum.cosmos.network/u/bush888us)\
**Post date:** [August 7, 2026, 7:57am UTC](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146/11 "2026-08-07T07:57:35Z")

</div>

Phase 1’s finding that inflation still supports staking demand, while sell pressure is concentrated among a relatively small number of large holders, raises an important downside-scenario question for Phase 2. Will the next model publish the effective bonded ratio, validator or stake concentration, and the security budget under different issuance reductions combined with large undelegations? A base case and a stress case—together with the assumptions behind each—would make it easier to evaluate whether lower liquid issuance improves ATOM economics without weakening network security.

---

<div class="post-metadata">

**Author:** ![TRAVE](https://yyz1.discourse-cdn.com/flex031/user_avatar/forum.cosmos.network/trave/32/9010_2.png) [@TRAVE](https://forum.cosmos.network/u/TRAVE)\
**Post date:** [August 9, 2026, 11:03am UTC](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146/12 "2026-08-09T11:03:32Z")

</div>

It’s been a while since I last posted here, but I wanted to jump in and leave a comment so that different parties don’t spin the narrative to suit their own agenda or distort how investors actually behave.

Great analysis by `@Dominator008`. I fully support the critical points raised in this review.

The fundamental flaw in Gauntlet’s model is assuming that lowering nominal inflation directly reduces sell pressure, ignoring investor psychology and real-world capital allocation (such as rebalancing into BTC or covering personal expenses).

**Consider a practical example from an individual investor’s perspective:** If my strategy relies on taking yield to finance myself, cover expenses, or diversify into assets like BTC, I will continue cashing out my rewards regardless of whether the APY is 10% or 30%. My withdrawal intent remains unchanged.

In fact, lowering the APY can create the exact opposite effect:

- **Shift in Re-staking Ratio:** To maintain my target capital inflow into BTC under a lower APY, I would likely decrease my re-staking contribution (e.g., shifting from a 50% re-stake / 50% cash-out split to a 25% re-stake / 75% cash-out split).

- **Aggressive Profit-Taking on Rallies:** If lower inflation triggers a temporary price rally, the higher USD/BTC value of rewards creates a stronger incentive to dump ATOM for liquidity before any potential market peak.

Lowering interest rates does not magically change the investor intent behind that 62.8% cash-out rate. The extraction rate will not disappear by slashing yields; without addressing why capital leaves the ecosystem, reducing APY simply forces holders to sell a larger proportion of their yields to hit their target capital goals.

---

<div class="post-metadata">

**Author:** ![TRAVE](https://yyz1.discourse-cdn.com/flex031/user_avatar/forum.cosmos.network/trave/32/9010_2.png) [@TRAVE](https://forum.cosmos.network/u/TRAVE)\
**Post date:** [August 9, 2026, 11:14am UTC](https://forum.cosmos.network/t/atom-tokenomics-phase-1-outcomes/17146/13 "2026-08-09T11:14:57Z")

</div>

Before blindly moving forward with Phase 2 and cutting interest rates/APY across the board, I urge the community and developers to pause and carefully consider these behavioral realities.

Simply slashing yield is a blunt and lazy fix. There are already brilliant ideas floating around this forum, posted by talented economists, mathematicians, and financial minds, that focus on capital retention and value creation rather than pure yield destruction.

**None of the concepts below are my own; I am simply surfacing and rescuing these earlier community proposals so they are properly taken into account before taking the easy path:**

- **Fee Burns and Token Sinks (Previously Proposed Idea):** Implementing “black hole” mechanisms where network transaction fees and protocol revenue are burned to counter inflation organically. _(Credit to the community members who originally proposed this)._

- **Tiered / Step-Up Staking Incentives (Recalling Past Forum Proposals):** Structuring staking rewards to dynamically favor long-term holders and those who consistently re-stake, penalizing pure extraction while boosting loyal participants. _(Rescued from earlier discussions)._

- **In-Hub Ecosystem & Native Liquidity (Surfacing Existing Forum Ideas):** Expanding native token utility and keeping USDC/swap routing strictly within the Cosmos Hub so every trade generates native revenue to burn or distribute back to stakers. _(Concept originally put forward by other contributors)._

I take no credit for these proposals, but they represent far better alternatives than simply slashing APY. Phase 2 should focus on creating native demand, burning supply through usage, and incentivizing re-staking—not just cutting interest rates and hoping for the best.

**CC:** `@PoppoNoChains` `@qwoyn` `@mariashaikh` `@RoboMcGobo` — _Tagging key research, governance, and Cosmos Labs leads so these behavioral market insights and community alternatives are properly evaluated before finalizing Phase 2._