Summary
- The maximum supply of FNSA will be changed from the current 1 billion to unlimited.
- The Unbonding Time of FNSA will be changed from 24 hours to 7 days.
- The version management format (parameter) for software and policy will be refined.
- This content is intended to be incorporated into the Finschia v2.0 policy, subject to the outcomes of the on-chain governance voting by the Finschia Governance Members (FGM).
Greetings from the Finschia Foundation.
In our continuous pursuit of ecosystem prosperity, we aspire to achieve accelerated growth by fortifying our token economy.
Consequently, we find it imperative to adjust the FNSA max supply and to extend the unbonding period in alignment with the Finschia policy, ensuring the resilience of our ecosystem. This communication serves to elucidate the rationale behind this adjustment, elucidate the anticipated changes, and provide insight into the expected outcomes.
Changes in FNSA Max Supply
Since the launch of the LINE Blockchain project in 2018, through LINK (LN) and now FINSCHIA (FNSA), the maximum supply of tokens has been set at 1 billion. Until Finschia applies the new token economy and inflation model in December 2022, the old LINK ecosystem was based on user rewards (80%) and reserves (20%). However, with the implementation of the Zero Reserve strategy, the Foundation has been issuing FNSAs solely through inflation caused by block generation, and we want to stabilize this policy by correcting the maximum supply.
Rationale for Changes
- Delegated Proof of Stake (DPoS) based Finschia
The current maximum supply of FNSA is set at 1 billion, and the token economy is designed to align with this maximum supply with a gradual downward adjustment of the inflation rate. On December 22, 2022, the manual token issuance method based on the old LINE Blockchain will be replaced with an inflation-based DPoS blockchain system, and the maximum supply for many major PoS and DPoS projects will be set to unlimited (∞). Therefore, it was deemed necessary to change the maximum supply to match the current technical structure of the Finschia mainnet. - High FDV (Dilution Value)
The current FDV of FNSA is approximately $30 billion as of December 13, 2023, which is significantly high relative to market capitalization. This high FDV poses challenges for potential FNSA holders and exchanges to enter and list the project.
Resolution Approach
**As of 2023.12.13, 1FNSA: $30; Circulating supply: 7,425,607 FNSA
❖ Changes to the maximum supply of FNSA will have absolutely no impact on the speed or quantity of FNSA circulating in the market, the chain protocol, and the actual level of FNSA usage.
❖ Unlimited issuance does not exceed the existing 1 billion mintage and does not imply the issuance of an excessive amount of tokens.
❖ The FNSA inflation rate will be set at a maximum of 15% per year to allow for FNSA stakes and payments. Based on the previously announced tokenomics plan, it is planned to be maintained at a maximum of 5% depending on the Finschia ecosystem and network activity/stability.
Changes in Unbonding Time
The unbonding time* for Finschia stands at 24 hours, a duration notably shorter than the standard mainnet Layer-1. We recognized that the frequent and swift unbonding activities of users who have staked FNSA may pose challenges to the network’s stability and impact the price stability of FNSA. In response to ongoing community feedback emphasizing the necessity for a more extended unbonding period, we have decided to adjust the unbonding time from 24 hours to 7 days.
*Unbonding time: The duration of inactivity on the mainnet implemented for the safety and stability of the entire staking process.
Rationale for Changes
- Enhance network reliability
Finschia currently has one of the shortest unbonding periods among the top 20 mainnets, potentially contributing to network instability in the face of short-term issues and events. - Ensure FNSA price stability
To alleviate sensitivity to short-term issues and events and ensure the stability of FNSA prices. - Addressing community feedback
Responding to persistent community requests for unbonding time adjustments, aligning with the goals of fostering network stability and ensuring FNSA price stability.
Resolution Approach
- (Before) 24 hours
- (After) 7 days
Change the versioning format of Software and Policy Upgrade Process
Rationale for Changes
- To manage the versioning of Finschia policies more efficiently and systematically.
Resolution Approach
- As-is: {Major}.{minor}
Major: Major policy upgrades
minor: Minor upgrade - To-be: {Major policy, Major parameter, minor}
Major policy: Policy major upgrade
Major parameter: On-chain parameter change
minor: Minor upgrade
Finschia Policy
Changes made through the major update will be reflected in the Finschia v2.0 policy, subject to input from the Finschia Governance Members (FGMs) and voting through an on-chain governance proposal. The on-chain vote will be open for seven days, and if the governance vote is approved, the entire Finschia user base will be required to comply and respond to the policy updates outlined in the proposal.
We are the blockchain for all.
Finschia Foundation
