[PROPOSAL #82][REJECTED] ATOM 2.0: A new vision for Cosmos Hub

@LeonoorsCryptoman Cutting the inflation to low levels is absolutely necessary to move towards a sounder and more desirable ATOM. Low inflation + Treasury war chest is the ideal configuration for ATOM holders. We get the best of both worlds.

The Treasury Pool is something ATOM holders will control and will have access to, meaning some of it can flow back to ATOM holders (dividends).

I’m confident this is the right play with the right accountability in place.

Get an even better version by having a 60M $ATOM warchest, low inflation and inflationary rewards distributed in pure $ATOM to staked holders.


See my updated answer to @LeonoorsCryptoman

Thanks for your very very quick responses!!

Can I translate your sentence;

The Treasury Pool is something ATOM holders will control and will have access to, meaning some of it can flow back to ATOM holders (dividends).

This means that your ATOM acts more like a stock? Where you own a part of the company (more or less) and that the stock can rise (and fall) in value, but gives you also the opportunity to earn dividends?
And with the accompanying advantage of ICS and such?

I am prepared to vote in favour of creating a Treasury of 60M $ATOM in order to facilitate the growth of Cosmos hub but i am not prepared to give up receiving rewards in $ATOM for as long as there are inflationary rewards.

You could possibly ask the community to sacrifice some of the rewards down the road if issuing 60M is not enough but looks bad to state that the 3.6M annually will be going to the treasury. It should be the other way round.

I want to control part of the fruits of my tokens’ labour directly, that is i want to receive the inflationary rewards of my staked $ATOM. In $ATOM.

I feel there are many others like me.


Not sure I follow you here. Inflationary rewards will always be paid in ATOM, no matter the inflation rate, whether it is 1% or 10%. On top of inflationary rewards paid in ATOM, you also get:

  1. ICS revenues from other tokens (index on ICS growth)
  2. Additional dividends from the Treasury pool generated by revenues from Scheduler and Allocator (up to the community to decide how much and at what time)

Correct me if i am wrong but i have been told that inflationary rewards will be going to the Treasury not directly to staked holders’ accounts. That is, 300k $ATOM per month will be issued exclusively to the treasury after the 36 month period has lapsed.


Edit previous post: you were right, the 300 K ATOM were initially supposed to go to the Treasury Pool. Sorry for the misstatement. This is up to debate. I lean towards the 300K ATOM going to the ATOM stakers but this is my personal opinion.


I will vote no to create a Treasury of 60M ATOM, it is so big and we all know no key no money, that is not our money. Maybe less than 10M is ok, and I think there is enough invest to initial ATOM. Why they need again. I donot want to lose my right. if that pass, I will unbond and sell all my ATOM. Fuck, I have buy them at the highest price.


If this turns to be true. My vote will be NO WITH VETO.

I’m in favour of the 36 months treasury “warchest” to boost up Hub development.
But enough is enough.
Further inflationary rewards should go to Atom Stakers , all of it and not a single $Atom to treasury!

If later on the road the treasury would need more funding , draft a new prop.


Having read the whitepaper, I understand the intended vision and direction and agree that this is a positive move for the Hub. Thanks to all those who put in substantial effort to get this to where it is. No small feat.

My primary concern with the proposed whitepaper is that ATOM stakers are asked to take on substantial risk while the treasury ‘war chest’ assumes no risk. I understand ATOM stakers get to vote on the make-up of Councils and direction of the treasury. More on that later.

Asking any investor to take on 100% of the risk seems naive. A better balance that provides returns to ATOM stakers and builds the treasury while the new modules mature should be found.

The current model gives me the impression that the proposers are not confident in the returns that can be generated from the new modules; if you are, you’d also want some of the returns from the new modules sent to the Treasury. Additionally, having an ongoing 1% issuance to the treasury compounds this. The Treasury is a substantial percentage of the supply and dollars; this should not be continually topped up at the expense of ATOM stakers (not talking dilution, BTW). I’m talking about a reduction in returns through issuance. There should be a better balance between Treasury and stakers.

The only confirmed outcomes from the whitepaper are technical implementations, Treasury token allocation and a reduction in staking rewards for stakers. While all other elements are vague and left to future proposals and assumptions on returns. As stated earlier, splitting the whitepaper into multiple proposals wouldn’t work as some elements may not pass. The same goes for Councils and Treasury investments. There should be a level of confidence that once the whitepaper has passed, the first round of Council, Assembly and Investment is known. Alternatively, reduce the scale of the initial proposal and iterate on the changes. This is far too large a first step with so many unknowns.

This proposal has a significant “Trust your devs” element. The ICF et al., have known transparency issues, only recently looking to address those. Asking stakers to take such substantial risks without addressing these issues first doesn’t seem fair.

The Hub’s track record on controversial Governance proposals doesn’t instil confidence in how the Treasury will be managed. A constitution should be implemented before Council, Assembly and the Treasury are managed through Governance. We’ve already seen bribery, of sorts, sway the outcomes of a proposal. What will occur when we’re dealing with hundreds of millions of dollars?


Re 2b : At the end of the 36 month period, NO atom will be left for stakers.
The 300K a month will go to the treasury.

Of this monthly issuance, the amount of ATOM issued to validators and dele-
gators as a security subsidy will start at the same subsidy level as immediately
precedes the transition phase. The subsidy will decrease by 10% every month
for 36 months, at which point **it will cease entirely.**

I think we can all agree this is a massive shift and with so many moving parts it’s a little overwhelming to try and project what $ATOM will be in 3 years.

To me, providing some examples as to what revenues will look like in terms of fee structures, how stakers and the treasury will earn these fees and a complete overview of what we might be able to expect.

For sure things will change but it would be nice to try to understand the scope of this proposal vs. just saying “the new fee distribution model will match or outpace current issuance”. Sure, that may be more than possible, but how, exactly, with figures, will this happen?

I guess I’m trying to understand if there are “x” consumer chains and the Hub charges “x” for their services it will generate “x” in fees per some period of time.

Lastly, I can see why people are saying stakers are losing or having to sacrifice yearly issuance rewards so the treasury can build a warchest that doesn’t directly benefit them.

However, if we can get a full picture of the governance model that will be implemented it should ease some minds.

What’s stopping the community from proposing to distribute a portion of the monthly issuance plus a portion of the revenue generated by the treasury to stakers?

If stakers/holders have complete or near complete contra over the treasury it would definitely change my perspective on how the $ATOM issuance is being handled.

100% I would rather have really yield rather than a slightly higher APR from emissions causing inflation. But how you get their and how much control over the treasury stakers/holders have matters so much.

I hope by October 24th we have an idea on how much revenue will be generated by month 12, 24 and 36.

It would also be nice to see the governance proposal so we understand how much actual control is given to stakers/holders over the treasury.

Please, school me if anything I said was incorrect or misunderstood by me.



Once again an upcoming proposal has generated quality feedback and exchange of views here. After days of watching this discussion, my general feeling is that we are talking about something that can help grow the ecosystem, but there are a lot of things that need to be clarified and a few things that should definitely not happen…

While I’m not in the mood to repeat concerns that have already been mentioned here, I can’t ignore the fact that this proposal essentially asks from ATOM stakers to bear all the risk and I have the impression that the proposers are not confident for many parameters… As for that sense of urgency, that’s not something I’m comfortable with… Sometimes it’s better to move slowly and with faith to follow ATOM’s consistent principles and I have the impression that this prop must definitely be redefined, with greater respect for ATOM holders. Otherwise, this proposal will probably do harm to the ecosystem and I completely agree with @johnniecosmos that the rewards should always flow in raw $ATOM, directly to staked holders. In my opinion this should be non-negotiable and anything different in this regard, could create bad results and rifts.

Finally, as far as this

I want to pretend that I never read it… A healthy community never cares about qualified teams and ‘‘honored’’ councils… In general, we always looking for additional ways to decentralize the voting power… Even the one who has only 1 ATOM counts, and WE should treat him with respect.

This is what decentralization means…


I think most would disagree is with the funding of the treasury, or at least are dubious about it.

  1. its at the cost of current diluting current Atom holders and future ones too, because those tokens will be dumped on the market sooner or later to pay for things.

  2. There is no real need to fund projects. Every serious project gets money throw at it. There is no lack of capital in the crypto space. And every projects gets to print their own money and be self-funded! If a project has to ask from funding from this public treasury, its probably just trying to get easy extra money that does not really need.

  3. One can make a case that there are some things that are “public goods” that need funding. I think the Ethereum community funds for these things (and projects too) in a better way through gitcoin. The ones who want to participate, do so, and not at the expense of the others.

  4. Size is massive. 55M ATOM IS A LOT. Half of it is a lot too. Not only at today prices, but Atom can be 100$ easily next bull run, making the treasury as big as 5b or more. This is f* you money, that there is no chance it can be allocated with efficiency. And almost every crap can and will get funding and we know this is dumped on the market at the expense of holders.

We could thrive without the treasury, and certainly with a much smaller one imvho.

A lot of people in the crypto space value individual sovereingty. Having a treasury this big goes against it.


I will also vote No with a veto to have 60 million Atom in the treasury! Why do we need so much? Let me give you an example. Terra had 150MIllions for funding and nobody applied in 6 months, so the funds remained there. Why Atom treasury will be different from Terra funds if there are no projects?

Please check their funding programs here:

[Proposal][TFL][CommunityPool Spend] Rapid Grants to Accelerate Ecosystem Development with Committee Oversight- There was no funding for 6 months!

So you guys want to do the same thing that Terra did and didn’t work. [Rapid Grants to Accelerate Ecosystem Development with Committee Oversight??

They created the council and nobody got funded for 6 months. No updates, nothing! You guys should read the Luna classic forum and see what happened with that council that had 32Million Luna in their treasury! Learn from their mistakes! there it’s a lot to learn there!

Here it’s an example of what happened with 32MIllion Luna that was in the treasury!

I hope this message finds you well. I am concerned by the ongoing silence of this committee. The Rapid Grants Committee currently hold $32M in LUNA in its wallet. We have not heard from you since August 2021. An update at this point is mandatory and should not be delayed for any reason. Do right by the community and let us know your plans for all that money.

The same thing will happen with ATOM treasury!

I will vote Yes for 5-10 MIllion Atom in the treasury, but no more! How many projects do you guys think will apply to get funding? I will tell you. Maximum 30-50 projects! Basically 1 Million Atom per year they will need!


so this is fundamentally not true.

there is an important safety feature that seems to have been missed:

if bonding rate drops below 2/3 – which we can expect to happen if revenue generated from ICS is not enough to incentivise stakers – then the new monetary policy stops, and the original monetary policy resumes

note there is a rather unfortunate typo in the paper. you should replace “,” with “2/3”


After gathering some thoughts around this proposal and the feedback that’s been happening over the past few days, there are a few things I want to say:

First up, thanks for putting together this proposal, the new whitepaper was definitely well thought out, and it was a good read to set the vision straight as to what Cosmos can be in the future.

Next, regarding the discussion, that’s ongoing here about the treasury funds.

From the way I see it, there are 2 sides to the story here:

  • One side is ATOM stakers who are worried that they will get diluted due to the size of the treasury and how after M36, rewards will be heavily reliant on the success of the treasury
  • The other side is the vision that the whitepaper sets forth: To make sure that the income from the economic engine of Cosmos + the endeavors set out using the treasury will be equal to or more than enough to incentivize users to stake

Now, various points have been brought out by @Rarma and @Frank regarding (1) Putting most of the risk towards ATOM stakers at the tail end of the transition phase when the security subsidy is negligible and (2) The risk of having most of the community funds unused in the treasury funds.

In that regard, I would like to propose a few things:

  1. Currently, the reason why people are against this long-term vision of transitioning the mindset of staking for security to staking as a function of value from the Cosmos ecosystem is that it’s super hard to visualize it. In that sense, I would love to see if we could have a gauge of the rewards one can expect from the cumulative fees from both the economic engine and Interchain Security to put things in perspective.

  2. It would also be best if we could have a guideline for the funds going into the treasury, and have a fallback that’s independent of the one that’s for the security of the chain and staking ratio (ie. If over the period of 6 months, <x amount of ATOMs were deployed with a return of <y%, the next issuance will put % more of issued ATOMs towards stakers vs going into treasury).

  3. I do think that allocating part of the rewards from the endeavors of the treasury towards the treasury itself makes sense to spread the risk and incentivize the treasury funds to be properly used during the transition phase, up until a certain period near the steady state where stakeholders are convinced of this new model.

  4. Last but not least, we need really clear guidelines and updates on who/what/where these treasury funds are going to and who is controlling them. The last thing we want to see is the recreation of “Project Dawn” that happened on Terra at a much larger scale (for context, Dawn was the allocation of 3M LUNA MoM (worth $90M pre-collapse at that point of time) with almost zero visibility on where these funds went).

That’s all for me today. Let me know what you guys think about it and would be happy to help in any way. Just ping me on Telegram or Twitter :slight_smile:


The purpose of funding the treasury is not funding projects in the Cosmos ecosystem. The purpose of the treasury is ensuring ATOM holders have exposure to projects in the thriving Cosmos ecosystem.


After Month 36 the treasury is well capitalized and should not depend on further issuance to fund itself. Assuming capital has well been allocated should yield returns from growth initiatives, that flow back to the treasury, while issuance rewards continue to accrue to stakers.