Non-Inflationary Model

Definition ∞ A non-inflationary model in digital asset economics refers to a token supply mechanism designed to prevent the continuous increase in the total number of tokens over time, thereby avoiding a decrease in purchasing power due to new supply. This is typically achieved through a fixed maximum supply, a burning mechanism, or a decreasing emission schedule. Such models aim to maintain or increase the scarcity and value of the digital asset. It offers predictability in supply dynamics.
Context ∞ The discussion around non-inflationary models centers on their effectiveness in preserving token value and their suitability for different economic use cases within decentralized systems. A key debate involves the trade-offs between scarcity and the need for new token issuance to incentivize network participation. Critical future developments include advanced tokenomics designs that balance long-term value preservation with ecosystem growth requirements. News often highlights projects adopting these models as a means to attract and retain value-conscious participants.