📈Inflation

QCK token inflation is designed to promote decentralization, boost liquid staking adoption, and strengthen community ownership of the Quicksilver protocol. By creating incentives for validators, delegators, and protocol users, inflation helps align interests across the ecosystem and fosters sustained growth.

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Four Pillars of QCK Inflation

1. Secure the Quicksilver Chain Inflation rewards validators and delegators who stake QCK, ensuring the network remains resilient against attacks and continues operating efficiently.

2. Support Decentralization on Native Chains The Quicksilver protocol encourages diverse validator sets on the onboarded chains. By distributing rewards, Quicksilver helps those chains maintain robust security through liquid staking.

3. Incentivize Protocol Adoption & Usage QCK tokens are used to reward users who actively participate in the protocol—such as by minting and holding qAssets—which increases liquidity and engagement in the Quicksilver ecosystem.

4. Empower the Community A portion of inflation is allocated to a Community Pool, where governance can decide how to spend funds for the protocol’s and community’s benefit.

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Year 1 Inflation Distribution

During the first year, Quicksilver’s inflation rate is 25%. The newly minted QCK tokens are allocated as follows:

• 80%: Staking Rewards Distributed to validators and delegators who stake QCK to secure the Quicksilver chain.

• 10%: Participation Rewards Granted to active users of the Quicksilver protocol (e.g., those who hold or mint qAssets).

• 7%: Incentive Pool Used to attract new users and incentivize liquidity providers, continuously growing and diversifying the network.

• 3%: Community Pool Controlled by governance, these funds can be used to support developer grants, community events, marketing, and other initiatives that benefit Quicksilver.

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Governance-Driven Inflation

All parameters of QCK inflation—such as total inflation, yearly inflation targets, and emissions allocations—are configurable through on-chain governance. The Quicksilver community retains full authority to:

• Adjust the Annual Inflation Rate Based on market conditions, protocol needs, or the evolving DeFi landscape.

• Revise Distribution Percentages Modify how the newly minted QCK tokens are divided among staking rewards, participation incentives, liquidity incentives, and the community pool.

• Manage Supply & Emissions Monitor the overall token supply and guide protocol sustainability over the long term.

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Inflation Trajectory & Max Supply

• Year 1: 25% inflation

• Subsequent Years: Expected to drop by 25% per year until it reaches zero.

• Max Supply: Under this schedule, the maximum supply of QCK is projected to reach approximately 400 million tokens before inflation ceases.

These decreasing rates aim to balance early-growth incentives with longer-term sustainability for the QCK token economy.

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Key Takeaways

1. Ecosystem Growth Inflation-focused distributions promote broader adoption of liquid staking and active governance participation.

2. Sustainable Tokenomics Gradually lowering inflation aligns with the protocol’s goal of rewarding early contributors without compromising long-term token value.

3. Community-Centric Governance By empowering QCK holders to control inflation parameters, Quicksilver ensures the protocol remains flexible and responsive to community needs over time.

Through its carefully designed inflation model, Quicksilver aligns incentives among validators, delegators, and protocol users, reinforcing decentralization, security, and ongoing innovation in the Cosmos ecosystem.