Make ATOM great again

Hub Proposals
8

Thank you for your response, you raise good points. Let me respond to each.

  1. My initial post wasn’t clear - I think we should target a staking APR of 2-4%. Staking APR is still at 15.10%! There are two massive problems with this.

First, the funding rate to short ATOM is generally positive, and when it’s negative, it’s less than the staking APR. That means, many existing ATOM holders are likely staking, hedging out ATOM exposure, and selling staking rewards. Leeches! Lower inflation neutralizes this strategy.

Second, 15%, even 10%, is too high a staking reward to incentivize usage in defi. We want the ATOM token to be loved, and used! It’s been a staking token for 5 years. What’s that gotten us? The dispersion in returns tells a clear story. We ran the experiment, and SOL won. The path forward is clear; the market wants fast L1s. Even Ethereum is starting to realize this, with pushes to fix defi on the L1.

This is perhaps the most important point, because the other points follow from this one. I expect pushback on this point from two groups, farmers bleeding ATOM dry (described above) and validators. To validators, I say this: ATOM has the potential to go to $100, which would make your business much more valuable. Think long term.

  1. Agreed. Snappy block times are free, and there’s no reason we shouldn’t do this today. It’s an easy technical change, the validators can do it without a chain upgrade.

  2. We can’t outsource the L1 because it won’t help ATOM. The only way to save ATOM is to save ATOM. Neutron’s success accrues value to the NTRN token. That’s fine, and I’m taking no position on the Neutron team or token. This is about ATOM. It’s about cleaning our house, before worrying about others.

Here’s the truth, shared security has weak PMF. Restaking protocols are mainly points farms right now, and while there’s a lot of upside potential, it’s an unproven model. Performant blockchains with strong communities have high PMF. We should keep ICS around, but Cosmos Hub needs to save itself, before saving others. Or it’ll be bled dry.

I own 0 ATOM tokens, and don’t have a vested interested in any organization that does. I’m not interested in benefiting a select few, I’m interested in making ATOM an attractive asset to hold. I find it personally sad, and tragic, that the ATOM token has so much potential, and the changes to unlock its potential are so small, but we are unable to make them happen for silly reasons.

So I’m going to try to make it happen, through force of will, and reason.

Can you elaborate on this point? I don’t follow.

this unfortunately sounds like yet another sly pivot to take from the staking incentive (earning transaction fee’s + rewards) to benefit the select few

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