Summary
The IOTA Foundation plans to increase its total holdings of all IOTA tokens from 2.78 billion to 4.6 billion, representing a 65 percent increase. This decision has shocked investors who are concerned about inflation.
Introduction
The IOTA Foundation recently announced that it will be injecting the upgrade Stardust into IOTA, resulting in a 65 percent increase in the total amount of all tokens. This move is aimed at financing the further development of the ecosystem. However, many commentators on social networks are appalled by the intentional inflation and predict an average inflation rate of 12 percent for IOTA by the end of 2027.
Main Points
– The IOTA Foundation made four strategic decisions without community participation or voting, leading to criticism from commentators who refer to the foundation’s actions as the “IOTA Central Bank strikes” and even a “scam.”
– The increase in IOTA’s total holdings is made possible due to the foundation’s control over the central coordinator. With the Stardust upgrade, the coordinator will be replaced by a ten-seat committee.
– The Stardust upgrade will involve a hard fork, and the foundation plans to maintain an old network called IOTA Stardust Classic for four weeks, where the token increase will not occur.
– The IOTA side project, Assembly (ASMB), has been officially scrapped, and participants will be rewarded with an airdrop into IOTA. However, some criticize the size of the airdrop compared to the percentage spent on contributors.
Conclusion
The IOTA Foundation’s decisions have left investors with concerns and uncertainty. IOTA’s current trading price is at its lowest level since 2020, and the constant selling of newly generated tokens by the foundations will likely exert price pressure on IOTA in the future. The centralized nature of IOTA’s governance under Dominik Schiener has also raised eyebrows.
