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Aptos Community Proposes 50% Cut in Staking Rewards : What’s Next for the Network?
The Aptos community has proposed a significant change to its staking rewards, aiming to align with other Layer-1 blockchains and boost capital efficiency. The proposal suggests reducing staking rewards by almost 50%, which could have far-reaching implications for the network.
According to the proposal submitted by MoonSheisty, the staking rewards would be cut from 7% to 3.79% over the next three months. This drastic reduction is being justified as a means of encouraging validators to focus on securing the network rather than solely pursuing high returns.
The initial feedback on GitHub indicates mixed reactions to this proposal. While some users are open to exploring alternative revenue streams, others have expressed concerns about the potential impact on the network’s decentralization and smaller validators’ ability to participate in staking.
It is crucial for Aptos to consider the long-term effects of such a drastic change. If not managed carefully, it may deter smaller validators from participating in the ecosystem, potentially weakening the overall security and integrity of the blockchain.
The proposal suggests introducing a community validator program to provide grants and staking opportunities to smaller validators who contribute to the ecosystem. This move could help offset the negative impact on decentralization.
Notably, Aptos currently has a total value locked of $974 million as of April 18, with approximately $320 million attributed to Aries Markets, the lending protocol. The high staking rewards have raised concerns that users may be deterred from exploring higher-risk and potentially higher-reward activities like restaking, DePIN infrastructure, MEV, and Defi.
This proposal is not an isolated incident in the blockchain space. Other notable blockchains have previously proposed or implemented changes to their staking procedures. For instance, Polkadot had suggested reducing unstaking time to just two days, while Starknet introduced a new staking mechanism. Vitalik Buterin has also offered his insights on addressing staking issues.
As Aptos navigates this critical decision, it is essential that the community weighs the potential benefits and drawbacks of such a significant change.
Source: https://coinpedia.org/news/aptos-community-proposes-50-cut-in-staking-rewards-whats-next-for-the-network/
