Comment on page
Controlling CST supply
There's currently no hard cap on the supply of CST token, making it an inflationary token.
Community members often point to this as a cause for concern, and while the chefs certainly understand the wish for a hard cap, there's a big reason we don't expect to set one in the near future:
CST's primary function is to incentivize providing liquidity to the exchange. Without block rewards, there would be much less incentive to provide that liquidity, but exchange fees. would remain.
So what are the other ways CST's supply is limited to counter inflation?
The team aims to make deflation higher than emission by building deflationary mechanisms into CryptoSwap's products. The goal is for more CST to leave circulation than the amount of CST that's produced.
By reducing the amount of CST made per block, we slow inflation. This has already been done once, we've already effectively reduced the number of CST entering circulation from 0.01 CST per block to 0.001 CST per block. But we don't want to do this too frequently, too early, for the same reason we don't want a hard cap: we still need to incentivize people to provide liquidity.