Osmosis DEX (OSMO) Cuts Token Inflation by 50%

Osmosis, the largest decentralized exchange (DEX) on the Cosmos ecosystem, has launched a significant update, OSMO 2.0, aimed at cutting the token inflation rate by 50%.

Osmosis Cuts Token Inflation by 50%

Following a governance vote, Osmosis has decided to halve the inflation rate to enhance the sustainability of the OSMO token.

With the new update, the inflation rate of OSMO will be around 11%. This adjustment is expected to help Osmosis achieve a balance between growth and stability, according to the project team.

Osmosis is a core DEX in the Cosmos ecosystem, facilitating trades in ATOM and bridged tokens like Axelar wrapped BTC, ETH, and stablecoin USDC. The platform currently holds over $126 million in Total Value Locked (TVL), according to DeFiLlama.

TVL of Osmosis as of June 20, 2023. Source: DeFiLlama

Osmosis is also working on a mechanism to burn protocol revenue, offsetting the remaining inflation and aiming for a net deflationary model in the future.

Additionally, the project is discussing changes to the liquidity pool fees, enabling OSMO stakers to share and receive a portion of the swap fees generated within the liquidity pools.

The price of OSMO has remained stable over the past 24 hours, currently trading around $0.49.

1H Chart of OSMO/USDT on Binance at 08:20 AM on June 20, 2023

This update is considered the most significant upgrade for Osmosis since the beginning of the year. After launching its stableswap trading platform late last year and being listed on Binance, Osmosis has remained relatively quiet without many notable advancements. The project previously faced a major security breach, with many users exploiting the situation, but it promptly addressed the issue.

Stay tuned for further updates on Osmosis and the broader developments within the Cosmos ecosystem.