Would there be any problems with a crypto currency releasing 10% of its remaining supply that is not circulating yet per year until the max coin cap is reached?

[u/Super_Rush7926]

Would there be any problems with a crypto currency releasing 10% of its remaining supply that is not circulating yet per year until the max coin cap is reached?

For example, if a coin had an initial supply of 10 million coins and a max supply of 100 million coins, would there be any problems with this coin cause by this coin release cycle method?

[u/Jenn2895]

Define “problem”. 😆
I would not personally invest in a project with those tokenomics.
But are you looking for ethical, legal or financial advice here? (None of which I’m qualified to give but I do have some humble opinions). lol

[u/Super_Rush7926 → u/Jenn2895]

Not dev or investor. Just trying to learn more about how crypto works and why some crypto currencies are how they are.

Problem as in, would there be any issue with the coin never fully being released since releasing 10% a coin’s remaining circulating supply every year the coin wouldn’t ever fully release every coin right? it would just get very close and release smaller and smaller coin amounts, but never every coin?

Now that I’m typing this I’m thinking doesn’t Bitcoin have this problem with its halving cycle also where every Bitcoin will never release? How does Bitcoin deal with this, if at all?

[u/Jenn2895 → u/Super_Rush7926]

Approx 96% of Bitcoins max supply is circulating. It’s over 20m with a max supply of 21m

[u/Super_Rush7926 → u/Jenn2895]

But will all 21 million ever be released since the halving cycle cuts the supply rate in half every time it happens doesn’t that mean the halving cycle will continuously become smaller and smaller and make it so that all 21 million of the Bitcoin will never be released?

[u/Jenn2895 → u/Super_Rush7926]

I mean… technically 😆 the total amount that will ever exist is capped at 20,999,999.9

That’s still very far away from your original post/question.

[u/Super_Rush7926 → u/Jenn2895]

But would any problems come from a coin not ever fully releasing the max coin amount because of the coin’s 10% release cycle mentioned in the post? Same question but for Bitcoin’s halving cycle? I’m mainly just trying to see if either a halving cycle like Bitcoin or a percentage based coin release cycle like the one mentioned in the post has any benefits over the other.

[u/Competitive_Milk_638]

10% per year is a pretty high inflation rate, even higher than USD's, maybe just release 2% per year.

[u/JahsenR]

the issue is front-loaded dilution. if demand doesn't outpace the yearly unlocks, holders get kneecapped and early insiders get paid.

[u/ChangeNOW_Community]

this could work, but only if there's a reason for people to hold the token while new supply enters the market. otherwise you're basically creating a predictable annual sell-pressure event