5Th Proposal from the markpui

Cap future inflation at 2.5% per epoch when BSD > $1.

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Intention The current inflation cap is set at 4.5%-9.0%. The rate of BSD printing may result in rapid deceleration of BSD price past $1, until it is below $1. Mechanism Change inflation cap to 2.5% per epoch when BSD > $1. Advantages • Reduces inflation during an epoch where BSD > %1. Disadvantages • The APY on Seignorage Shares will decline as BSD inflation will be reduced. However, this may lead to normalized, sustainable long-term APY, rather than short-term capital that moves in and out. • Due to the reduction in BSD emission when BSD > $1, there will also be less BSD available for bonds to be redeemed (ensuring that all bondholders will tend to be come long-term bondholders rather than short-term bondholders).