AIOZ Network Tokenomics 2.0
Tokenomics 2.0 cuts AIOZ inflation 1% a year, from 8% in 2023 to 5% in Dec 2026. Covers the 50/50 inflation reward split and four token burn sources.
This post was published in December 2023 and describes the schedule announced then. For current figures, see the AIOZ tokenomics page in the docs. The original 2020 allocation and vesting terms are in AIOZ Token Allocation and Vesting.
Revised tokenomics for healthy ecosystem growth and an incentivized stakeholder community
With the launch of AIOZ W3S (now AIOZ Storage) imminent and a packed 2024 roadmap, we are excited to announce that we have made considerable changes to the tokenomics that underpin AIOZ token.
This update is in an effort to satisfy both the future demands of our rapidly expanding ecosystem of infrastructure products and dApps, and also to ensure that our various stakeholders are appropriately rewarded for their support and participation in the Network.
Current AIOZ Network Tokenomics
After the successful launch of the AIOZ Network Mainnet back in December 2021, a 9% inflation rate was applied to the AIOZ Network token, which came into effect from March 2023 due to block time production.
Whilst this number is not dissimilar to various other popular networks in the industry, we understand that high inflation rates can lead to economic instability within the network. By gradually reducing token inflation, we aim to create a more stable economic environment for our users, stakeholders, and the overall AIOZ community.
V2 AIOZ Network Tokenomics
The revised mechanics behind the AIOZ token highlight a proactive measure to ensure that our tokenomics remain adaptive to the evolving needs of the network and its participants, fostering a sustainable and balanced token economy.
AIOZ tokens serve various functions within the network, including staking for security, rewarding node managers, and facilitating transactions. A controlled inflation reduction optimizes the utility of the token, ensuring it remains a valuable and versatile asset within the AIOZ ecosystem.
Moreover, by reducing inflation, AIOZ aims to enhance security and ensure a resilient infrastructure that can withstand potential security challenges.
A Commitment to Minimal Inflation
From December 25th 2023 onwards, inflation of the AIOZ Network token will be decreased by 1% each year on December 25th, for a total of 4 years. This means a total of 4% reduction and a resting inflation rate of 5% by 2026.
Proposed Inflation Schedule
- 8% 25th December, 2023
- 7% 25th December, 2024
- 6% 25th December, 2025
- 5% 25th December, 2026
With a long term base target of 5%, we aim to considerably increase the incentivization for stakeholders within the AIOZ Network. The proceeds of this inflation will be distributed as before:
- 50% of Inflation Rewarded to Validators/Delegators
- 50% of Inflation Sent to Treasury
With 4 large infrastructure pillars in active development, Treasury tokens will be used in part to incentivize growth, adoption and expansion of our products:
- AIOZ W3S (now AIOZ Storage)
- AIOZ W3AI (now AIOZ AI)
- AIOZ W3IPFS (now AIOZ Pin)
- AIOZ W3Stream (now AIOZ Stream)
Catalyzing growth of the AIOZ Network developer and partner ecosystems will mean further utilization of the AIOZ token. AIOZ tokens will function as means of payment within dApps built on the AIOZ Network, resulting in a flourishing and healthy network of dApps, developers and users plus a token with considerable utility.
Token Burn
We have worked hard in an effort to ensure a healthy future for the AIOZ Network token; implementing changes such as programmatic token burns based on network usage and regular token burns in several areas.
Token burning will occur in the following instances:
- 50% of ALL AIOZ Network Blockchain Transactions
- 5% of ALL Node Rewards
- 5% of ALL Infrastructure Revenues
- 5% of ALL AIOZ Native dApp Revenues
Conclusion
The AIOZ token serves an integral function within the AIOZ Network ecosystem.
AIOZ Network's success relies in part on a healthy and balanced token economy. Implementing regular token burns, in addition to reducing inflation, safeguards against potential issues associated with token oversupply. These measures contribute to sustaining a secure and sustainable ecosystem.
Frequently Asked Questions
What is AIOZ Tokenomics 2.0?
A revised token model announced in December 2023. It lowers AIOZ inflation step by step and adds regular token burns tied to network usage.
How does AIOZ inflation change under Tokenomics 2.0?
The proposed schedule cuts it 1% every 25 December for four years: 8% in 2023, 7% in 2024, 6% in 2025 and 5% on 25 December 2026. The long-term base target is 5%.
Who receives the inflation?
Half goes to validators and delegators. The other half goes to the treasury.
What does the treasury pay for?
In part, growth, adoption and expansion of the four infrastructure pillars in development at the time: AIOZ W3S (now AIOZ Storage), AIOZ W3AI (now AIOZ AI), AIOZ W3IPFS (now AIOZ Pin) and AIOZ W3Stream (now AIOZ Stream).
What gets burned?
The post lists 50% of all AIOZ Network blockchain transactions, 5% of all node rewards, 5% of all infrastructure revenues and 5% of all AIOZ native dApp revenues.
What is the AIOZ token used for?
Staking for security, rewarding node managers and paying for transactions. The AIOZ Network ecosystem overview shows the products and partners around it.
Related Reading
- AIOZ Token Allocation and Vesting: Original 2020 Metrics: the 2020 supply, allocation and vesting plan.
- AIOZ Network 2025: Roadmap and Brand Transformation: what was planned for 2025.
- AIOZ Network Ecosystem: chains, partners, wallets and DePIN services.
- AIOZ Bridge: how to move AIOZ between Ethereum, Binance Smart Chain and AIOZ Network.
About the AIOZ Network
AIOZ Network is Web3 Infrastructure for AI, Storage and Streaming.
AIOZ empowers a faster, secure and decentralized future. Powered by a decentralized content delivery network (dCDN), AI computation and thousands of individual nodes run globally, AIOZ rewards you for sharing your computational resources for use in storing, transcoding, and streaming digital media content and powering decentralized AI computation.
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