Lava Network releases LAVA token economics, with 6.6% allocated for API provider rewards

ChainCatcher news, modular blockchain infrastructure developer Lava Network has released the LAVA token economics. The total supply of LAVA tokens is 1 billion, and it adopts a deflationary mechanism to attract API providers in the initial phase of the mainnet. Of these, 25% of the tokens will be used for future plans and reward reserves (6.6% of the tokens will be allocated monthly to provider rewards); 31% of the tokens will be used for research and development as well as ecosystem protocol maintenance and development; 17% of the tokens will be allocated to investors; and 27% of the tokens will be distributed to early contributors, core team members, advisors, and other contributors.

In addition, validator rewards will decrease as the percentage of LAVA staked increases, linearly decreasing between 60% and 80%. When the staking ratio reaches 80%, rewards and half of the subscription fees will be burned, making them no longer in circulation. LAVA token holders can choose to stake their tokens with validators, re-stake with providers, and participate in on-chain governance. Users can purchase LAVA subscription plans on-chain to access various API "specifications" through the Lava protocol.

"Specifications" are modular objects defined by the management department that specify the types of APIs that providers must support. Providers stake tokens on a single "specification" to ensure the integrity of their services. Lava Network completed a $15 million seed round financing in February, co-led by HashKey Capital, Jump Capital, and Tribe Capital.