With Its Price Plummeting by 93%, the Founder of an Altcoin Has Proposed a Radical Change: Final Desperate Efforts or a Glimmer of Hope?

Celestia (TIA), which draws attention among modular blockchain projects, has been on the agenda with its recent major loss in value. As TIA dropped by 93%, a dramatic change proposal emerged within the community. Celestia co-founder John Adler proposed removing the current Proof of Stake (PoS) mechanism entirely and replacing it with a new and experimental Proof of Governance (PoG) system. According to Adler’s statement on the Celestia governance forum, with the PoG system, the annual supply of the TIA coin will be reduced by 20 times. This means that the annual staking reward of approximately $ 127 million will be reduced to only $ 4 million. In the new system, token holders will be able to choose network operators directly without having to lock their tokens. Adler argues that this structure would eliminate unnecessary complexity, reduce costs, and maintain network security as effectively as PoS, and that it is a more sustainable value creation model that directly increases the network’s revenues from data accessibility services. Celestia’s current PoS system has long been criticized, with criticism centering on the idea that high staking rewards are disrupting the economic balance of the network by increasing TIA’s inflation. Currently, Celestia distributes approximately 8% of its circulating coin supply as staking rewards each year, which has the effect of reducing the value of coins in circulation. Related News: Cold Wallet Users Beware: Important Security Warning Issued In addition, some investors, especially large funds and early-stage investors, earn rewards by staking their locked investments and selling these rewards on the market, which is seen as one of the factors that undermine trust in the project. Adler argues that staking is simply a system that penalizes those who do not stake coins and actually creates an economically unnecessary step in the process of determining the operators of the network. In the new PoG model: Staking and staking rewards will be completely removed. Network operators will only be rewarded for good performance, making punishment methods such as slashing unnecessary. The threat of token holders to dismiss operators will be the most important element in ensuring the security of the system. Governance votes will be conducted off-chain as the Celestia chain does not support such voting. While some blockchain enthusiasts criticize off-chain systems, Adler says they are no different from on-chain systems in terms of security, and Celestia already has a similar off-chain management infrastructure in place. Adler’s proposal has received positive feedback from the community so far, and discussions are ongoing, but the move could mean a fundamental shift in Celestia’s value generation model. *This is not investment advice. Continue Reading: With Its Price Plummeting by 93%, the Founder of an Altcoin Has Proposed a Radical Change: Final Desperate Efforts or a Glimmer of Hope?

Source: BitcoinSistemi