Stride Tokenomics Update: December 2022

The Stride team recently shared some minor changes to its tokenomics. Below, we shine a light on the update with a quick summary of the changes.

Revenue

As of Dec 16th, Stride has established a TVL of $6M across four blockchains for liquid staking.¹ Current revenue generation stems from a 10% fee on the staking rewards of liquid staked tokens, all of which currently goes to the Stride Foundation.

Through an on-chain governance vote, STRD stakers chose to redirect past and future revenue to themselves, to compensate STRD holders for staking their tokens and increasing the security of the chain. Now that it has been passed, the community is encouraged to make changes to the open-source codebase and then make a governance proposal to upload said changes.

Currently, STRD stakers only receive inflationary STRD rewards. If this change is implemented, stakers will receive 100% of protocol revenue in addition to these inflationary rewards.

Emissions

Separately, STRD emissions have been lower than anticipated: year-1 emissions are on track to be 2.5M vs the 9.5M that was planned, and the team is encouraging higher emissions in the final nine months of the first year, in order to compensate stakers with “back pay”. This change would only affect emissions for the remainder of year one, and year two would proceed as outlined in the original tokenomics article.

Token Lockup

STRD tokens that are currently locked up and allocated to contributors and investors can be staked. Currently, these tokens receive staking rewards, and contributors are working on a way to prevent investors and contributors from receiving these rewards on locked tokens so that everyone else can enjoy higher rewards. In the meantime, 100% of contributor staking rewards are going to the community pool.