SIP-00009: Emissions and Locked Staking Multiplier Adjustment

[jack-piplabs]

number	title	authors	sponsors	created	type	status	supersedes	superseded-by	extends
00009	Emissions Reduction and Locked Staking Multiplier Adjustment	Jack Chan (jack.chan@piplabs.xyz)	Leo Chen (leo@piplabs.xyz)	2026-01-18	Standard	Released

Summary

This proposal reduces annual token emissions from approximately 25 million to 15,315,000 IP tokens and decreases the locked token staking reward multiplier from 0.5x to 0.025x. These changes intend to adjust the emissions resulting from higher-than-expected block production under a per-block emissions schedule and align incentives for long term sustainability of the network.

Motivation

Story's original design targeted 20 million IP tokens emitted annually, based on an expected 10,368,000 blocks per year. Engineering optimizations have improved block production to approximately 13,140,000 blocks per year — a testament to network performance gains. However, the per-block emission rate remained unchanged, resulting in approximately 25 million tokens emitted annually.

Story's 0.5x locked staking multiplier is a unique mechanism that allows locked token holders to earn staking rewards at a reduced rate. As locked tokens transition to unlocked status over time, aligning incentives toward unlocked staking promotes healthier stake distribution across the validator ecosystem. Reducing this multiplier to 0.025x aligns locked token holders with the long term vision of Story while maintaining voting power for block production and, when available, onchain governance voting. This new multiplier change also redirects the majority percentage of staking rewards toward unlocked token stakers.

With the locked staking multiplier change, and without a corresponding reduction in total emissions, this shift would significantly inflate APY for unlocked token stakers. To recalibrate this, annual emissions will need to be updated from 20,000,000 IP tokens per 10,368,000 blocks, to 15,315,000 IP tokens per 13,140,000 blocks. This achieves two goals: it maintains a sustainable 6-7% APY for unlocked stakers rather than artificially boosting yields, and it reduces overall inflationary pressure on circulating supply.

Proposal

Token Emissions Adjustment

Parameter	Pre-launch Settings	Actual Rate	Adjustments Proposed
IPs minted per block	1.9290 IP	1.9290 IP	1.1655 IP
Blocks (per year estimates)	10,368,000 (estimated)	~13,140,000 (actual)	13,140,000
Annual emissions	20,000,000 IP (estimated)	~25,347,060 IP (actual)	15,315,000 IP

The emissions per block is now recalculated to be 1.1655 IP tokens per block produced to achieve the target annual emission of 15,315,000 IPs.

Locked Staking Multiplier Adjustment

Parameter	Current Value	New Value
Locked flexible period multiplier	0.5x	0.025x

Rationale

Reducing the locked staking multiplier to 0.025x redirects rewards toward unlocked token holders, promoting healthier stake distribution. The corresponding emissions recalibration to 15,315,000 IP tokens per year ensures this shift maintains a sustainable 6-7% APY rather than artificially inflating yields.

Voting power remains 1:1 between locked and unlocked validators. Operators in the active set choosing to continue running locked validators will retain their governance participation capabilities.

Drawbacks

Locked token stakers and locked validator operators will experience significant reward reduction, potentially causing some Validators to exit the active set and operate Unlocked Validators instead. This is an expected and healthy outcome as locked tokens transition to unlocked status.

Alternatives Considered

• Complete elimination of locked staking rewards: Rejected as too disruptive to existing locked validators
• Gradual phase-out over multiple upgrades: Rejected due to implementation complexity
• Maintaining current emissions: Rejected as it would not address long-term sustainability concerns

User Impact

For Unlocked Token Stakers: Yields are expected to remain competitive in the 6-7% APY range for flexible staking, with higher returns available through fixed staking periods.

For Locked Validators and Delegators: Validators accepting locked delegations will see significantly reduced rewards. Delegators to locked validators will receive proportionally lower returns.

Token Unlock Context: As locked tokens transition to unlocked status, stake distribution is expected to naturally shift toward the unlocked validator set--a healthy evolution for network decentralization.