What is the issuance and circulation of Osmosis coins?

The Osmosis ecosystem is governed by its native token, OSMO, which has a maximum supply of 500,000,000 coins and is distributed among the community pool, early investors and contributors, the Osmosis team, and the Interchain Foundation.

Nov 22, 2024 at 10:53 am

What is the Issuance and Circulation of Osmosis Coins?

Osmosis is a decentralized exchange (DEX) built on the Cosmos blockchain network. The native token of Osmosis is OSMO, which serves several important functions within the ecosystem. This article delves into the issuance and circulation of OSMO coins, shedding light on key aspects such as token distribution, inflation rate, and circulation supply.

Issuance of Osmosis Coins

1. Genesis Block Allocation: At the genesis block of the Osmosis blockchain, a total of 100,000,000 OSMO coins were created and distributed as follows:

   • 40% to the Osmosis community pool
   • 30% to early investors and contributors
   • 20% to the Osmosis team
   • 10% to the Interchain Foundation
2. Initial DEX Offering (IDO): The remaining supply of OSMO coins was distributed through an IDO held on the Osmosis DEX in June 2021. The IDO raised approximately $20 million and sold OSMO coins at a price of $0.10 per coin.

Circulation of Osmosis Coins

1. Circulating Supply: The circulating supply of OSMO coins refers to the number of OSMO coins that are currently in circulation and actively traded. The circulating supply is dynamic and changes over time due to factors such as token issuance, burning, and staking.
2. Total Supply: The total supply of OSMO coins is set at a maximum of 500,000,000 coins. This supply cap ensures scarcity and helps maintain the value of the token.
3. Inflation Rate: The inflation rate of OSMO coins is designed to be highly dynamic and responsive to the needs of the ecosystem. The inflation rate is adjusted through community governance and can be lowered or increased based on various factors, such as the demand for OSMO coins and the growth of the Osmosis ecosystem.

Token Distribution

The distribution of OSMO coins among different stakeholders plays a crucial role in ensuring the stability and decentralization of the Osmosis ecosystem. Key stakeholders and their OSMO distributions include:

• Community Pool: 40% of the total OSMO supply is allocated to the community pool, which is controlled by the Osmosis community through governance proposals. The community pool funds are used to support various development projects, marketing initiatives, and community events.
• Early Investors and Contributors: 30% of the total OSMO supply is allocated to early investors and contributors who played a vital role in the development and launch of the Osmosis project. These early supporters provide crucial expertise and support to the ecosystem.
• Osmosis Team: 20% of the total OSMO supply is allocated to the Osmosis team, which is responsible for maintaining and developing the Osmosis protocol. The team's allocation ensures that they have the resources to continue growing and improving the Osmosis ecosystem.
• Interchain Foundation: 10% of the total OSMO supply is allocated to the Interchain Foundation, a non-profit organization dedicated to supporting the development of the Cosmos ecosystem. The Interchain Foundation provides funding, technical assistance, and community support to various projects within the Cosmos network, including Osmosis.