Issuance Rate Decay

Issuance rate decay describes the mathematical process by which the rate of new token creation decreases over time according to a specific function. This decay is usually programmed into the protocol to ensure a smooth transition toward a fixed maximum supply.

As the decay progresses, the marginal cost of producing new tokens often increases, which can influence the market price. This predictable reduction prevents hyperinflation and encourages early adoption by rewarding early participants with a higher share of the supply.

It is a key metric for quantitative analysts who model the long term price trajectory of digital assets. The decay curve is a defining feature of a protocol's economic lifecycle.