Zilliqa, a prominent blockchain platform known for its innovative sharding technology, has announced a significant change in its mining reward structure.
Zilliqa has announced a new mining reward structure, which will see miner rewards halved each month in the lead-up to Zilliqa 2.0.
Starting in October 2024, the network will implement a halving mechanism that reduces mining rewards by 50% each month. This move is part of Zilliqa's broader strategy to transition from a Proof-of-Work (PoW) to a Proof-of-Stake (PoS) consensus mechanism with the upcoming Zilliqa 2.0 upgrade.
The halving mechanism, which was approved by a decentralized governance vote, will see miner rewards cut in October, November, and December 2024. By the end of this period, miners will receive only 12.5% of their original rewards. This gradual reduction aims to align the interests of miners and validators, encouraging them to support the PoS transition and participate in staking activities.
The proposal for the halving mechanism was first introduced at Zilliqa's governance forum in late September 2024. It was extensively discussed among community members before being put to a vote.
The voting process, which concluded on October 12, saw overwhelming support, with 97% of the voting power from gZIL holders in favor of the change. This high level of participation underscores the community's commitment to the network's evolution.
Following the announcement, the price of ZIL, Zilliqa's native token, surged by 8%, reflecting positive market sentiment towards the upcoming changes. The reduction in mining rewards will create a surplus of ZIL tokens, which will be reallocated to support community-driven initiatives, investments, and incentive programs.
These efforts aim to provide additional opportunities for developers, validators, and builders within the Zilliqa ecosystem.
The transition to Zilliqa 2.0 is a critical milestone for the network, similar to Ethereum's shift from PoW to PoS in 2022. The Jasper testnet for Zilliqa 2.0 went live in early September 2024, with the mainnet launch expected to bring significant changes to tokenomics, staking, and other network upgrades. The halving mechanism is a crucial step in this journey, ensuring a smooth and efficient transition to the new consensus model.
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