Injective IIP-617 received 99.89% overwhelming support, doubling the deflation rate, increasing long-term supply pressure on INJ

The Injective community nearly unanimously approved the governance proposal IIP-617, with a support rate of 99.89%, reflecting a strong consensus on the upgrade of the deflationary mechanism. The proposal has taken effect immediately, significantly strengthening the INJ token burn mechanism, making it one of the most deflationary assets in the crypto market. This major adjustment to the token economy marks Injective’s entry into a new development phase.

Strength of Community Consensus

Voting data says it all

In this vote, 27 million staked INJ participated, with a support rate of 99.89%, a rare figure in governance votes within the crypto community. This overwhelming support is not just a simple majority but nearly unanimous approval, reflecting the community’s high recognition of the project’s direction.

According to reports, Injective has previously burned approximately 6.85 million INJ. Based on this foundation, the new mechanism will further accelerate the burn process.

Core Upgrade of the Deflationary Mechanism

Details of the reform

The key to this upgrade lies in two aspects: first, reducing the issuance of native tokens to lessen the pressure of new supply; second, enhancing the burn mechanism by allocating 8% of protocol revenue for buyback and burn, creating a continuous cycle of supply reduction.

Why this is important

In the current market, most projects face inflationary pressures, but Injective has chosen the opposite route. The deflationary mechanism means that as network activity increases, protocol revenue grows, and burns will also increase. This creates a positive feedback loop: the more active the network, the more burns occur, reducing circulating supply and increasing scarcity.

Market Status and Outlook

Current token status

According to the latest data, INJ is currently priced at $4.78, with a market cap of $477.51 million, a circulating supply of 99,970,935 tokens, and a total supply of 100,000,000 tokens. The circulating supply is already very close to the maximum total supply, indicating that most tokens have entered the market.

In this context, activating the deflationary mechanism is particularly important. It is becoming increasingly difficult to significantly increase new supply, while burns will gradually reduce the circulating supply, thereby changing the supply and demand dynamics.

Potential for accelerated deflation in the future

According to related news, Injective is executing multiple strategies: expanding institutional partnerships, increasing US policy engagement, and advancing RWA tokenization. These initiatives are expected to boost protocol revenue, thereby driving larger-scale burns. Especially, the progress of RWA tokenization could significantly increase on-chain trading volume and protocol fees.

Personal opinion: If Injective’s RWA business progresses smoothly, protocol revenue will see a noticeable increase, which will directly translate into greater burn pressure. In the long run, this supply-side contraction is expected to provide structural support for the value of INJ tokens.

Summary

The 99.89% voting support reflects the Injective community’s high recognition of the deflationary upgrade. With the deflation rate doubled, the burn mechanism strengthened, and a foundation of 6.85 million tokens already burned, INJ is gradually evolving into an asset with strong deflationary properties. The key will be whether Injective can expand application scenarios and increase protocol revenue to fully realize the potential of this deflationary mechanism. Short-term price fluctuations may continue, but in the long term, this adjustment to the token economy provides new support for INJ’s scarcity.