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  • XLM developers believe that it is abused by users.
  • The feature may lead to scalability issues.

Representatives of the Stellar Development Foundation (SDF) said they would remove the inflation feature in the upcoming protocol update, as users are not utilizing it for its intended purpose

“After listening to what everyone had to say and weighing the pros and cons, here’s what the SDF is asking validators to consider: we think it’s a good idea to disable the current inflation mechanism,” they wrote in a blog post.

 XLM tokens generated on the platform on a weekly basis (in total 1% per year) were intended to support projects on the Stellar network. However, users don” vote for useful projects, instead, they tend to join in pools to receive payouts to their own accounts.

” Every week, the protocol creates new lumens; every week the majority of those lumens go to individual account holders or to SDF accounts”  Stellar developers. wrote.

.Also, the developers are concerned that it may lead to a scalability issues in future.

“Inflation pool payments don’t have much of an operational impact right now, but as Stellar grows and the number of accounts increases, they will start to drag. The more the network grows, the bigger the problem will become.”

They invited validators to install a new version of the protocol. The network update is shceduled on October 28.

If consensus on the upgrade is not reached, the developers will return the inflation function in the next version.

At the time of writing, XLM/USD is changing hands at $0.0583, down 5% on a day-on-day basis. The coin takes the tenth place in the global cryptocurrency market rating with the current market capitalisation of $1.17 billion.