KEY TAKEAWAYS
- The Radix Foundation is consulting XRD token holders to gather input on a proposed change to the ecosystem’s tokenomics and strategy.
- The proposal includes reallocating 1 billion XRD for incentives and another 1 billion for a Growth Fund, while reducing the maximum supply by 6 billion XRD.
- Token holders can use Radix Off-Ledger Authentication (ROLA) to securely signal their support or opposition without on-chain transactions.
- The consultation aims to empower the Radix community to influence the ecosystem’s strategic direction.
The Radix Foundation has announced a consultation period for XRD token holders from May 9 to May 19, 2025. This initiative aims to gather community input on a proposed change to the tokenomics and long-term strategy of the Radix ecosystem. The proposal, detailed here, seeks to redirect the stablecoin reserve towards incentives and growth initiatives.
The proposal outlines the allocation of 1 billion XRD for incentives to boost on-chain liquidity and usage, and another 1 billion XRD for a Growth Fund to support strategic initiatives. Additionally, the plan includes a reduction of the maximum supply by approximately 6 billion XRD, shortening the emission schedule by 20 years. The remaining 400 million XRD will be held in reserve for potential future use or burning.
How the Consultation Works
During the consultation, token holders can connect their accounts to a dedicated dApp to signal their support or opposition to the proposal. This process uses Radix Off-Ledger Authentication (ROLA) proofs, allowing secure proof of signaling without requiring on-chain transactions. The input will be weighted based on the time-weighted average amount of XRD or XRD equivalents held during the consultation period.
After the consultation concludes, the Foundation will publish the aggregated results, a breakdown of support and opposition by account, and the corresponding weighting based on XRD holdings. To ensure fairness, the Foundation and any entities controlling over 1 billion XRD will not participate in the consultation.
Why Use ROLA Instead of On-Ledger Transactions?
ROLA offers several advantages over traditional on-ledger voting. It eliminates transaction fees, preventing ledger spam and encouraging broader participation. The system ensures privacy while maintaining verifiability through cryptographic signatures. ROLA is integrated into the Radix Wallet and dApp Toolkit, utilizing established cryptographic standards to ensure security and authenticity.
The consultation represents an opportunity for the Radix community to influence the strategic direction of the ecosystem. More information and access to the consultation dApp will be provided before the start date on May 9.
Why This Matters: Impact, Industry Trends & Expert Insights
The Radix Foundation’s consultation on repurposing its 2.4 billion XRD stablecoin reserve is a strategic move to enhance liquidity and support ecosystem growth. This initiative seeks to gather community feedback on significant changes to its tokenomics, including reallocating reserves to incentivize on-chain activity and strategic growth initiatives.
Recent industry reports indicate that stablecoin issuers in 2025 are increasingly focusing on safety, liquidity, and yield by repurposing reserves into high-quality assets like U.S. Treasury instruments. This trend towards Treasury-backed stablecoins aligns with Radix’s strategy to enhance stability and yield, reflecting a broader industry shift towards more secure and efficient asset management.
According to a Coin Bureau review, Radix’s focus on its asset-oriented paradigm and advanced smart contract capabilities positions it uniquely in the Layer 1 blockchain space. The proposed tokenomics adjustments are seen as necessary to incentivize adoption and compete effectively, highlighting the importance of these changes in driving meaningful developer and user engagement on the Radix network.
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