What is Token emission?
Token emission is the overall rate of creating and issuing new tokens. It is of 3 major types:fixed emission, dynamic emission, and deflationary emission.
Token emission is the overall rate of creating and issuing new tokens. It is of 3 major types:
Fixed emission,
Dynamic emission, and
Deflationary emission.
Fixed emission
Fixed emission is when the rate of new coin issuance is predetermined and does not change.
This means that a fixed number of new coins are issued at regular intervals, regardless of market conditions or other factors.
if a token has a slow fixed emission schedule, it may not be able to respond quickly enough to changes in demand or market conditions.
If a token has a fast fixed emission schedule, it may lead to inflation and a decline in the value of the token.
A dynamic emission rate can better adapt to changing conditions and maintain a more stable value.
Dynamic emission
Dynamic emission is when the rate of new coin issuance is adjusted based on certain conditions or factors. This can be done to:
incentivize certain behaviors,
maintain a stable value for the token,
distribute new tokens to different groups of people,
fund specific projects or initiatives.
Deflationary emission
Deflationary emission is when the rate of new token issuance decreases over time. This means that the supply of new tokens becomes more scarce as time goes on, potentially leading to an increase in the value of the coin. Deflationary emission is often used in cryptocurrencies with a limited total supply e.g. Bitcoin.
Credits: Some of the information is from OpenAI