Inflation of the OP token is set to 2% per year by default. This inflation takes place via the
MintManager contract calling the
mint() function on the OP token contract at
This inflation parameter can be adjusted by Optimism Collective Governance. In Year 1, while the Citizens’ House is still in early stages, inflation adjustment will be determined via vote from the Token House, as specified in the Operating Manual.
Note that this may not be the final governance process for inflation; the system may evolve as additional governance rights and capabilities come online.
Inflation accrues to the “Unallocated” portion of the OP token allocations. The Unallocated portion of the treasury is held in reserve for future programs. For now, the Collective is focused on building healthy processes around the existing active portions of the treasury.
In the Voting Cycle that ends closest to and before May 31, the Token House may vote to set inflation to any value between 0% and 2%, inclusive.
This inflation adjustment vote must pass with 76% approval and 30% quorum of votable supply. If no vote passes, inflation will default to 2%.
In 2023, an Inflation Adjustment Vote may take place in Special Voting Cycle #12b, which runs from May 18 - May 31, 2023. If more than one Inflation Adjustment Proposal is passed by governance, the proposal with the highest ratio of
yes votes to total votes cast will pass.
Inflation Adjustment approval should follow the template provided below and will need 4 delegate approvals by May 17th at 19:00 GMT to proceed to a vote, as outlined in the Operating Manual.
Inflation Adjustment Proposals should follow the template below:
What is this inflation adjustment proposal?
Why should the Collective adjust inflation?
This proposal would set an inflation rate for [YEAR] of [X%].
If approved, and if not superceeded by another Inflation Adjustment Proposal with higher approval, this proposal will result in a one-time mint of OP of [X]% of the current total supply (4,294,967,296 OP) equal to [Y] tokens. This inflation will occur on or shortly after May 31 and accrues to the “unallocated” portion of the token treasury.
If not approved, and unless another Inflation Adjustment Proposal is approved, inflation will remain at 2%, which will result in a one-time minting of 2% of the current total supply, or 85,899,345 OP. Inflation will occur on or shortly after May 31 and accrues to the “unallocated” portion of the token treasury.
Expected effects resulting from inflation adjustment
Expected impact to key stakeholders in the Collective