While @celestia's recent update reduced inflation by 33%, a new proposal has been introduced on their governance forum to cut an additional 50% from 5% to 2.5% These are our high-level takeaways: • Issuance Implications: Halving base inflation from 5% to 2.5% removes ~29m of new TIA tokens each year and trims eight-year issuance by ~220m TIA, bringing the 1.5% terminal inflation rate forward by a full decade. • Validator economics: Raising the commission floor to 10% lifts the stake-weighted fee from 14.2% to 16.5% 54 validators (~55% of stake) must adjust, shifting about 0.7m TIA per year from delegators to operators, small on a network-wide basis, but meaningful as rewards shrink. • PoG Remains the Optimal Economic Path: In our opinion while this is a directionally correct move for issuance policy, PoG’s 0.25% inflation track still dominates on long-term scarcity. Over eight years it mints about eight-times fewer TIA than the newly proposed schedule, pushing the network close to neutral issuance while leaving headroom for DA-fee growth and other potential product offerings to do the heavy lifting. We believe PoG remains the clearest path to durable, value-accretive token economics. --------------------------------------------------------- Disclaimer: The information provided by Kairos Research, including but not limited to research, analysis, data, or other content, is offered solely for informational purposes and does not constitute investment advice, financial advice, trading advice, or any other type of advice. Kairos Research does not recommend the purchase, sale, or holding of any cryptocurrency or other investment.

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