So if Jae leads a drive to lower Min Inflation to 0% we would have a situation where Min Inflation is 0% and Max Inflation is 20%. This makes the range of possible outcomes for the 10 year supply picture of ATOM even larger making it impossible for investors to plan ahead. In addition, he has expressed support for more rapid changes of the inflation rate. This increases the volatility/turbulence levels of ATOM supply making it more event driven. This event-driven 0% to 20% inflation range is basically what the Fed does to set interest rates for the US dollar. The Federal Reserve has a monetary policy making committee called the Federal Open Market Committee (FOMC) that sets interest rates. The committee is made up of representatives of the US government and the US banking industry. In the case of ATOM, the monetary policy making body (the FOMC equivalent) are the token holders like Jae and big validators who can determine whether inflation is 0% or 20% by bonding and unbonding their stake around the 66.67% threshold. Let’s not forget that Jae is one of the largest ATOM holders and he singlehandedly can move the staking ratio depending on his own bonding and unbonding decisions effectively making Jae a chairman of this monetary policy making committee.
Making the supply completely uncertain and centralizing decision making in the hands of a few large stakeholders and delegates who are using other people’s money as voting power is a direct copy of the Wall Street’s Federal Reserve central banking model. The users and investors in the currency (ATOM) are completely at the mercy of this central committee of big validators and large token holders like Jae. The top 10 addresses holders of ATOM control 25% of the stake with the very top one holding more than 5% alone (or nearly 20 million ATOM).
One of the core principles of Bitcoin (and crypto in general) is supply certainty. Everybody knows what Bitcoin’s supply schedule is. Crypto is not just about decentralization but also about supply certainty. Jae Kwon routinely changes his mind about supply issuance. He makes promises about something and then changes his mind later based on some reason. Now his latest bait-and-switch is who he will grant GNOT to. He was going to take a snapshot of ATOM stakers in Prop 69 but now he doesn’t want to do that. Jae is also running at the moment what is traditionally known as a short selling campaign by actively taking advantage of low prices to discourage other holders of ATOM and accumulate their stake. He has repeatedly called for other people to sell their ATOM and leave. He didn’t do that in 2021 when ATOM prices were high near $40 but he is doing that now when prices are low. Jae will retain firm control of control of ATOM supply issuance by backroom dealing with large validators. He has been doing that since ATOM was created. ATOM’s monetary policy decision making is thus about as opaque and “corrupt” as it gets in the crypto industry. Jae Kwon simply wants to be the central banking chairman of his own currency. The only sad thing here is that neither Jae nor his validators have anywhere near the economic competency of the FOMC committee.
If this proposal passes then ATOM becomes even more of a pump-and-dump token.
