1. Background
Approximately 43% of the total token supply remains locked.
Under the current emission schedule, more than 20% of the total supply is expected to enter the market annually over the next two years.
The scheduled unlock of 20% of the total token supply on May 19 represents a highly concentrated release event that may create a significant short-term supply shock. This will have a negative impact on the long-term price movement, and we have seen it happen.
Over the past two years, we have observed how excessive supply combined with insufficient demand has exerted sustained downward pressure on price. Accelerated token emissions in the absence of adequate market absorption have repeatedly weakened overall market stability.
This proposal does not aim to reduce the total token supply.
Rather, it seeks to redesign the rate and structure of token emissions.
■ Plan A
Fixed 5% Annual Supply Cap (Stability Model)
Structure
-
Eliminate the single 20% large-scale unlock
-
Cap annual token unlocks at a maximum of 5%
-
Transition to a long-term distributed schedule
Characteristics
-
Maximizes predictability
-
Removes concentrated supply shocks
-
Provides the market with sufficient absorption time
This is the simplest and most executable model,
designed to maintain stability across market cycles.
■ Plan B
5% Base Annual Supply + Quarterly Performance-Based Unlocks (Strategic Model)
Core Structure
-
5% base unlock in Q1
-
Additional 1% unlock per quarter upon meeting defined conditions
-
Maximum additional unlock per year: 3%
-
Maximum total annual emission: 8%
Additional Unlock Conditions
For the following quarterly intervals:
-
Q1 → Q2
-
Q2 → Q3
-
Q3 → Q4
An additional 1% unlock is permitted if:
The 90-day average token price increases by at least 15% compared to the previous quarter’s average.
Safeguards
-
The 90-day average price must be used (not single-day spikes)
-
Price must remain above the year-start reference level
-
Maximum 1% additional unlock per quarter
Structural Implications
-
Bear market → Automatically limited to 5% annually
-
Recovery phase → 6–7% annual emission
-
Strong bull market → Up to 8% annually
Supply expansion occurs only when the market demonstrates sufficient strength and absorption capacity.
This model balances stability with strategic flexibility.
■ Plan C
Step-Down Emission Model (Gradual Deceleration)
Example Structure
-
Year 1: 8%
-
Year 2: 6%
-
Year 3 and beyond: 5%
Or alternatively:
- 10% → 8% → 6% → 5%
Characteristics
-
Gradual reduction without abrupt structural change
-
A compromise between the existing schedule and reform
-
Mitigates short-term supply shock
Conclusion
This proposal does not call for a reduction in total token supply.
It calls for a redesign of emission velocity.
A predictable, absorbable, and market-responsive supply structure
is essential for long-term token sustainability.
Plan A prioritizes stability.
Plan B introduces strategic flexibility.
Plan C offers a transitional compromise.
If members of the Pyth Network community have additional ideas, refinements, or alternative frameworks that better serve the long-term health of the ecosystem, we sincerely welcome thoughtful and in-depth discussion.
The objective is not restriction for its own sake.
The objective is alignment.
A sustainable emission structure benefits both the protocol and its token holders.
When supply is predictable and responsibly managed, confidence improves.
When confidence improves, participation strengthens.
When participation strengthens, the entire ecosystem grows.
Pyth and its holders are not opposing sides of this discussion —
we are long-term partners in value creation.
We look forward to constructive dialogue and collaborative refinement of a model that allows both the network and its community to grow together in a mutually beneficial and sustainable way.
Thank you.