Klaytn, the Web3 gaming blockchain, has proposed reducing block rewards to reduce inflation and boost the price of its native currency.
Blockchain games and metaverses are the next big step in Web 3. These virtual spaces will offer us a open place where we can do anything we imagine. From having a work meeting to going for a walk on the beach, metaverses will offer us a huge variety of possibilities.
What is Klaytn?
Klaytn It is an open source layer 1 blockchain designed for all those who want to build, work or enjoy the metaverseIt is a unique blockchain that combines the best features of public and private blockchains to offer a novel platform focused on scalability and speed.
One of its strengths is found in the combination of public and private features, as it is able to offer all the advantages of decentralized chains, but without sacrificing scalability or performance.
How is this possible? Thanks to the Governance Council, a large alliance of DAOs and multinational organizations that operate their network of consensus nodes and drive the ecosystem.
In this way, Klaytn offers a Living environment, ready for the metaverse, but also for AAA quality games and to host the best DApps, connected to multi-chain DeFi services and integrated into OpenSea, the world's largest NFT marketplace.
With all this, Klaytn is laying the foundation for the creation of a vibrant and interconnected metaverse.
Why has Klaytn risen this week?
On October 23, Klaytn announced a governance proposal that will reduce the block reward.
The official information that has been presented by the Governance Council (GC) Klaytn's Q3 report notes that it intends to optimize the level of KLAY token issuance by applying a ⅓ reduction in issuance.
This reduction is intended coping with volatility which is observed in the macro markets and which has led to the collapse of several projects, as well as the bankruptcy of several cryptocurrency companies such as Celsius Network.
The governance proposal notes that “the current macroeconomic outlook is causing unprecedented volatility in the cryptocurrency markets and the current level of token issuance is not optimal to facilitate value accumulation for KLAY.”
If the proposal is approved, the rewards will drop from 9,6 current KLAY to about 6,4 KLAY, which will be distributed as 50% to the GC, 40% to the Klaytn Growth Fund (KGF), and 10% to the Klaytn Enhancement Reserve.
The proposed reduction has been calculated at function of the current circulation of tokens versus their demand. In this way, the team hopes reduce inflation KLAY's blockchain, making it more attractive to investors, while boosting its competitiveness and ensuring the sustainability of its tokenomics.
According to data from CoinMarketCap, KLAY token price has risen by 21,8% in the last 24 hours, up to $0,179 at the time of writing. However, the moment the proposal was submitted, the token shot up 106%, from $0,13 to almost $0,29 per token.
Although the proposal has not yet been voted on, the increase in the token price is a sign of acceptance, which could be positive for KLAY's future.
Despite the current volatile situation in the crypto markets, tokens based on web3 games are seeing increased growth, both in terms of adoption and investment.
In 2022, they have invested more than 4.000 billion dollars in crypto games, metaverses and incubators to boost the Web3 gaming industry.
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