According to Decrypt, following a community vote to reduce inflation on the Cosmos Hub's native token ATOM to 10%, founder Jae Kwon has called for a hard fork of the cryptocurrency. The division within the Cosmos community has led to a 4% drop in ATOM's price in the past day, currently valued at $9.29, according to CoinGecko. Proposal 848 passed with 41.1% of the network's voting power against 31.9%, with 6.6% voting for a veto and 20.4% abstaining. The proposal will decrease ATOM's inflation from approximately 14% to a maximum of 10%, reducing its APR from around 19% to about 13.4%. Supporters of the proposal argued that the inflation rate was higher than necessary for maintaining network security and that validators would remain profitable or break-even at a maximum 10% inflation rate, with the option to increase their commission rate to cover operational expenses.
In a Twitter post, Jae Kwon called for the community to 'coordinate a split,' suggesting a new network, AtomOne, should be forked from Cosmos with a new ATOM1 token. The proposed new network would support both ATOM and ATOM1. With 10% of the genesis supply of ATOM1 set to be premined for various purposes, a genesis distribution of the remaining 90% of token supply would be airdropped to those who opposed proposal 848, based on voting activity. Although the fork will use much of the existing Gaia architecture employed by Cosmos Hub, it will maintain a higher maximum inflation rate of 20% and include an altered governance mechanism requiring proposals to pass a two-thirds threshold to achieve quorum.
