I have thought long and hard about this decision, weighing the potential benefits and drawbacks. While the proposal to reduce the $JUP supply by 30% seems appealing at first glance, I believe it is essential to consider the broader implications for our community and the project’s long-term success. Here are my key reasons for voting NO:
Impact on Token Accumulators:
The proposed 30% supply reduction will most significantly affect those who have been consistently accumulating $JUP tokens. These are the loyal, long-term investors who believe in the project’s vision and future. By reducing their airdrop allocation by 30%, we risk alienating the very people we want to hold and support $JUP. These loyal holders are crucial for the stability and growth of the ecosystem.
2.Staking Commitments by Meow and the JUP Team:
Meow and the JUP team have pledged to stake their $JUP tokens, indicating they have no intention of selling anytime soon. Given the 50% split between the team and the community, the effective reduction might only be around 15%, as the team is unlikely to dump their tokens. This minimal theoretical reduction is unlikely to have a significant impact on the token price.
3.Loyalty Clause and Geometric Nature of Airdrop:
The Jupuary airdrop likely has a loyalty clause, rewarding long-term holders more significantly. The geometric tier system means that top-tier holders receive exponentially more tokens than lower tiers. For instance, a top-tier holder receiving 100,000 tokens would get 70,000 instead, while a lower-tier holder might only see a reduction from 100 to 70 tokens. This disproportionately hurts loyal, high-tier holders the most, undermining their loyalty and support.
4.Governance Power:
$JUP is a governance token, and more tokens mean more voting power. Reducing the overall supply diminishes the influence of loyal holders in the governance process, potentially weakening the democratic nature of the Jupiter DAO. Ensuring that dedicated community members retain their voting power is crucial for a healthy, decentralized governance system.
5.Uncertain Impact on $JUP Price:
A token reduction does not necessarily equate to a higher $JUP price. Market dynamics are influenced by various factors, and simply reducing the supply might not lead to the anticipated price increase. Investors should be cautious about assuming a direct correlation between supply reduction and price appreciation.
6.Effective Airdrop Criteria Can Prevent Dumping:
If the team gets the Jupuary airdrop criteria right, it will ensure that $JUP is distributed to those who are genuinely interested in the project and not looking to dump their tokens. This strategic allocation can prevent significant sell-offs when the allocation goes live, maintaining price stability.
7.Risk of Losing Faith:
If the proposal passes and the price does not increase as hyped, it could lead to a loss of faith in the project. People might ridicule the effort, questioning why even a supply reduction could not boost the price. This uncertainty and potential negative sentiment could harm the project’s reputation and investor confidence.
Conclusion
Voting NO to the 30% supply reduction proposal is a decision rooted in protecting the interests of loyal $JUP holders, maintaining effective governance, and ensuring the project’s long-term stability and reputation. While the idea of reducing supply might seem appealing on the surface, the underlying impacts on the community and token dynamics suggest a more cautious approach. Let’s focus on strategic growth and reward our loyal supporters to ensure the continued success of Jupiter.
Fairly newer here but not sure I’m seeing how a supply reduction makes things less interesting for those who’ve been accumulating?
The point around reduction in airdrop makes sense but if price is bullish (the very reason I’m getting more involved myself) I anticipate that price action will offset airdrop amount and work more in favor of loyal holders.
Appreciate the post! I was immediately going with a vote yes but always worthwhile seeing the other side.
I kind of agree too, moreover your accumulated tokens stay with you, in your wallets, it’s not available for the reduction, community reduction will be in ASR & Jupuary
I’m sure you also thought about it, weighing pros and cons, but I want to emphasis the risks of following the leader’s emotion in such a democratic decision
Boy am I glad to see someone of like mind! I always knew i liked you Lochie
Im torn… I understand that burning tokens should create scarcity/value over time for us which is important for a lot of people especially long term holders, BUT on the flip side… is that really the end goal here?
If you want to onboard the world you need to maintain a lower cost of entry and find other ways to generate value for your holders. We aren’t building a house, we are creating an empire. An empire not merely of tokenized value but one where your token IS power. And if you cant get one, or have to purchase less due to greed of others, well… you arent going to reach the world.
Impact on Token Accumulators:
Ps. this is a follow up to 30% Supply reduction : Pro's and Con's I Highly reccomend you read 
