INITIAL PROPOSAL: Cronos New Golden Age to Onboard Billions and Invest in the U.S. - Cronos POS V5 upgrade

[lezzokafka]

Abstract

Aligned with the ambitious vision and mission outlined in the Cronos and Crypto.com 2025 Roadmap - Cronos Chains and $CRO are committed to fostering the growth of reliable, robust decentralized networks to accelerate the adoption of Trad-Fi and AI-powered solutions.

To achieve these objectives and support the ongoing development of AI and the Cronos ecosystem, we propose the following updates to the network parameters and token allocations as part of the Cronos POS V5 upgrade:

1/ New Token Allocation

Advancing the key parts of the roadmap, including connecting $CRO to institutional liquidity pools through $CRO Exchange Traded Fund (ETF) by Crypto.com, securing a position among the top 10 protocols and achieving US ETF approval will be pivotal for driving institutional adoption of CRO. In order to achieve the above, we believe it is also critical to support America’s goal to become the capital of crypto, we are proposing to allocate 70 Billion of $CRO to the Cronos Strategic Reserve escrow wallet to bring the total supply back to 100 Billion:

• Support initiatives to drive attractiveness of the crypto ecosystem in the U.S.
• Trad-Fi crossover projects, including seeding the $CRO ETF with a focus on U.S markets.
• AI development and ecosystem growth through grants, developer tools, and funding for projects and Dapps.
  This allocation will be subject to a 5-year lockup period with linear monthly vesting. Refer to the ‘Technical Details’ section for protocol-level changes and allocation methods.

2/ Network Parameters Updates

As a complement to the proposed token allocation, we recommend adjusting the following network parameters in the ‘mint’ module to ensure competitive and sustainable staking rewards for delegators and validators:

• Update inflation_max from 3.7% to 1%;
• Update inflation_min from 1.2% to 0.85%

This is to ensure staking rewards remain competitive, offering an 8% staking APR under both the current and new value of total $CRO supply.

This proposal details a network upgrade for the Cronos POS Chain (crypto-org-chain-mainnet-1). Upon approval, validators and full nodes will be required to upgrade their chain-maind binary from the current v4.* to the latest v5 version at the designated block height to implement the proposed changes.

Technical details

From a technical standpoint, we propose the following changes to achieve the above goals:

Proposed changes

A/ Allocation of $CRO token to the Cronos Strategic Reserve escrow wallet address

70 Billion of $CRO to be allocated to the Cronos Strategic Reserve escrow wallet address “cro1…”. This Strategic Reserve escrow wallet will be subject to a new 5 year lockup period and linearly vested on a monthly basis (vesting is applied every approximately 30.4 days or 2,628,000s) via a native Cosmos SDK vesting account mechanism with “PeriodicVestingAccount” on Cronos POS chain. The proposed allocation is released by a periodic vesting account as shown below:

'@type': /cosmos.vesting.v1beta1.PeriodicVestingAccount
base_vesting_account:
  base_account:
    account_number: "0"
    address: ## cro1… Cronos Strategic Reserve wallet address ##
    pub_key: null
    sequence: "0"
  delegated_free: []
  delegated_vesting: []
  end_time: ## Time of vesting ends (upgrade height timestamp + 5 years)##
  original_vesting:
  - amount: "7000000000000000000"
    denom: basecro
start_time: ## Time of vesting commence (upgrade height timestamp)##
vesting_periods:
- amount:
  - amount: "116666666666666666"
    denom: basecro
  length: "2628000"
- amount:
  - amount: "116666666666666666"
    denom: basecro
  length: "2628000"
....
- amount:
  - amount: "116666666666666706"
    denom: basecro
  length: "26280002629800"

Based on this allocation and vesting scheme, approx. 1.167 billion $CRO will vest from the strategic reserves escrow wallet every month (approximately 2,628,000 seconds), and vesting will commence at the V5 upgrade height. These funds are not intended to be delegated while they are held by the Cronos Strategic Reserve escrow wallet.

B/ Network Parameters Updates

As the additional 70 billion $CRO will be added to the current circulating supply (bringing the total back to the initial 100 billion supply), to maintain competitive and sustainable staking rewards for delegators and validators, we propose adjusting the inflation parameters of the ‘mint’ module as follows:
1/ Update inflation_max from 3.7% to 1%;
2/ Update inflation_min from 1.2% to 0.85%.

Example of proposed parameters changes as following:

    "changes": [
      {
        "subspace": "mint",
        "key": "InflationMax",
        "value": "\"0.010000000000000000\""
      },
      {
        "subspace": "mint",
        "key": "InflationMin",
        "value": "\"0.008500000000000000\""
      }
    ]

As a reference, with the suggested maximum inflation of 1% and a total supply of 97.3 billion $CRO, based on the current total staked amount, we can maintain $CRO emissions via staking rewards at a rate similar to the current level of

• Approximately 8% staking APR, at 10% bounded ratio (9.7B staking);

This provides competitive staking rewards for both delegators and validators, incentivizing their contributions to secure the network.

Testing

Proposed changes will be tested on the Croeseid testnet testnet-croeseid-4 to ensure that the expected outcomes are achieved.

Conclusion

These proposed changes aim to advance $CRO adoption by preparing for the $CRO ETF submission, supporting Trad-Fi crossover projects, fostering AI development, and incentivizing ecosystem growth. This strategic combination of incentives and adjustments is designed to accelerate $CRO adoption, ensure sustainable growth, and support the AI-driven evolution of the Cronos network through the Cronos POS V5 upgrade.

Next steps

On-chain network upgrade governance proposal will be raised, and the following items summarize the voting options and what they mean for the proposal:
Governance Votes
The following items summarize the voting options and what they mean for this proposal.

• YES: You support the V5 upgrade of Cronos POS, which includes key updates to drive the seeding for the $CRO ETF and the development of an AI-powered ecosystem. These changes aim to accelerate ecosystem growth through strategic token allocations, refined network parameters, and strong incentives for adoption, innovation, and the preparation and bootstrapping of the $CRO ETF.
• NO : You do not support the V5 upgrade in its current form. This indicates that revisions or additional details are required. Your feedback is welcomed to help refine the proposal to better align with the goals of ETF preparation and AI ecosystem development.
• NO (VETO): You strongly oppose the V5 upgrade and its foundational objectives, including the $CRO ETF preparation and AI innovation initiatives. A veto signifies fundamental disagreement with the direction of this proposal.
• ABSTAIN: You are impartial to the outcome of the proposal. If the quorum is not met or less than 1/3 of the participating voting power has voted No, the proposal fails and is considered vetoed. In this case, the proposal deposit is burned rather than returned to respective depositors.

[Theohox]

Veto this. This will destroy the already tanked price of CRO. Just have Kris focus on real utility of CRO instead of gifting it to celebrities who just sell it and promoting meme coins. This is essentially just a move of hyperinflation. The community is very upset..just check X

[AKermanov]

Veto! A burned token should be gone forever—irretrievably consigned to oblivion. If their removal can be reversed, they aren’t truly burned; they’re merely locked, awaiting someone to deploy the code and resurrect them in production. I propose a countermeasure: ensure that burned tokens remain definitively burned, with no possibility of their return to the chain.

[raycro1210]

Veto!can make stake instead burn,but no more CRO coin , whatever bring them back or print new coins.... it's nosense.

[halliganboy]

Veto. Reversing a burn is a violation of trust and integrity of the ecosystem. This will sink CRO and people will boycott the ecosystem. Passing this will be the nail in the coffin to the long term CRO holders already riding the fence to dump or hold.

[geniusboy91]

Every few years it's a new rugpull with these clowns. First they rugged MCO, then they rugged cardholders, now rugging CRO. You should be embarrassed for even suggesting over 3xing the supply, but unfortunately this is par for the course of how this business operates.

[BaBaGucci]

Couldn't of said it better myself

[aalluubbaa]

Ok. Great roadmap and if you are ambition, PAY WITH YOUR OWN FUCKING MONEY. USE YOUR USD TO BUY THE NECESSARY CRO YOU PROPOSED.

What kind of coward move is that?? What are you risking?? You are risking the initial investors who believed in your project and dilute their holding value. It would be a BOLD AMBITION for us. What's there for you to risk??

You guys are clowns.

[CryptoPawz]

VETO! This is rediculous. Use the funds you made with running the exchange and don't dilute your customers.

[nmarko91]

What? I can't believe someone actually thought this is a good idea and that the community would support it? Really guys in CDC + Cronos team, do you have negative IQ or what?

Whoever can should VETO NO on this garbage

Imagine you are holding an asset and I come and say "YO LETS INCREASE THE AMOUNT OF IT BY A LOT, LIKE A LOT A LOT, TWICE MORE THAN THERE IS ALREADY NOW" - how would you feel? TOTALLY BETRAYED?

In economy, the wealth - in this case these new coins, have to go someone.. Who will get them? Not normal people that are holding for years so this is how you are treating all of us - we will get screwed again?

5B for the exchange of you caliber that makes insane money on fees I'd assume every day can "easily" be funded by you guys, WTF?! You could get a loan, raise investment, can do so many other things than this ridiculous action..

Reversing the burn, lol, thats so bad on trust of the all community??

[President-Platy]

VETO!!! I used to have much respect for Kris. The minting may not take place, but having these thoughts has seriously questioned his integrity. I really regret having chosen Crypto.com. Shame on you, Kris! I am really disappointed. How could you be so unreliable? I will take legal action.

[sangsoo78]

No, this is a crazy idea.

[codinthebarbarian]

Do a buyback to produce that level of supply for the reserve and stop leeching from your customers and users

[art-eth]

You should have managed the $CRO price over the last four years, and then you wouldn’t need to unburn anything. Pay for your actions—buy back what you need. This proposal is essentially stealing with white gloves.

[45freehold]

There's no way this can be real. It's not even the fools' day.
This proposal must be cancelled and Cronos should come up with something more thought through.

If $5B is a requirement to join the league - there must be a better way to raise the capital. Maybe as a 'loan' from the community, so that the minted 70B CRO would be bought back with CDC profits? Or some other mechanism or commitment to ensure this minted supply does not dilute the value. Also, 1.1+ Billion CRO released into the market each month is nonsense — if it has to be done, then the vesting should be long-term like 20-30 years, that's a 'Strategic Reserve' after all, not a rug pull. Or is it?

[marco-novelli]

Obviously NO WITH VETO

[dagnai]

You should buy back from the community, or borrow on interest rate in tradfi. You had 4 years to come up with a plan, and the only thing you can think of is a rugpull???

[fatihdlm]

Veto, this is very ridiculous proposal. This will destroy future of #cro

[josvanotterloo]

A big no for me!

[andrefaceira]

NO with VETO, there should be no way of bringing back burnt tokens. This will only hurt the trust we have in you and hurt the community that has been supporting you.

[btc-steed]

Most ridiculous idea, be ashamed to even propose it!

But I understand, validators will quit staking if it will not pass, because soon you cannot offer the 8% rewards anymore.

Rather than just printing new tokens, create utility for the blockchain so that people will actually start using it, and the validators can run on transaction fees!

[Arbri88]

Apply pressure where it matters most. FUD the hell out of CDC and keep the heat on until we get the clarity we deserve.

[peroisme]

NO with VETO！！！ What kind of CEO would come up with such a ridiculous idea?

[guiferrpereira]

NO. this will be the dead of CRO

[verifythestack]

VETO Strong VETO,
Going back on a burn brings into question any future decision made, the project keeps kicking their tokenomics every time there is any progress in the right direction. Increasing the supply 3x is rude. There currently 'should' be enough capital coming in from trading to be able to allocate in chunks to projects. ETFs are also TradFI is also not the goal, crypto in every wallet is

[deuchainn]

Can't understand the arguments for undoing the Burns about reaching more people, the need more tokens for an ETF and so on…

1. Nobody in the Solana community is proposing incrementing their supply which is max 1B tokens while the circulating supply is even less, and a Solana ETF is most likely coming. Also for an ETF the amount of tokens is irrelevant which we can see for the BTC and ETH ETFs that exists already
2. The other argument that we need more tokens to be relevant for Strategic Reserve, while it has come to hand the strategic reserve will solely focus on holding BTC like gold and eventually hold some other tokens that can be sold off for BTC longterm (https://x.com/Crypto_TownHall/status/1898029951586038110)

What CRO should focus on imho. is driving price up by adding scarcity to CRO and have people to want to hold CRO.

[deuchainn]

The mobile app let's you stake CRO to get other tokens, instead they should reverse this approach like how the NEXO CEX has done on their mobile exchange, by staking other tokens you get NEXO token which has driven their price about 5-6x the last two years.

Therefore the CRO platform should let one stake other tokens on the CRO app to get CRO, this would drive the price up, also having some validators for other chains and use fee earnings to burn CRO and staking up on stablecoins or other tokens holding would drive the reserve values of the CRO platform up imho.

[ML421]

I should close my account just for the proposal!

[elkojo]

VETO !!! Crypto.com "excels" in one aspect - complete unpredictability of the token economy. Move from memes and celebrities to core blockchain issues such as transacting safely and securely and you won't need to invent new ways to rugpull users every once in a while. How do you convince anyone to stake CRO when its tokenomics is a subject to a moments change by the infamous pathological liar Kris. Veto, otherwise you steal from CRO investors. Full stop.

[simon-iribarren]

VETO, only considering this would drop the credibility of this project to ZERO!!!

[mwhite34]

Scum move from CDC. Dilute their shareholders, to line their pockets. Minting over 2x the current total supply is already un-excusable, but after you already burned it? Not only that, but keeping the interest rates the same so literally none of it is going to stakers. Pure greed. Just hope I can un-bond and sell before their monthly 1.1 BILLION TOKEN DILUTION starts hitting every month for the next 5 years.

[deuchainn]

Yup what i did here when i heard the news unstaked and sold.

This was a one kind of market manipulation:

1. The proposal itself on mintscan never mentioned the unburn nor linked to details.
2. To not drive the price down they waited until one day before the proposal and then used all the centralized vote power to passthrough the the proposal. While letting people actually think there was a chance that the proposal would not go through.
3. The price pumped a lot after the vote got throught to just reach new bottom…

The CDC is as centralized as it can be, never thought it would be so not sure i'm coming back CRO where the stake is as centralized as it is 😞

[lukastanisic99]

Cdc validators came last minute to vote yes and get it to pass even though all non cdc validators voted no. This is clearly a centralized database and not a decentralized blockchain. Since they're doing it in the US, can a reputable lawyer start a class action lawsuit for all of us to join?

[deuchainn]

Totally manipulation to come in last minute and vote yes 😞 , the CDC is a centralized as a Blockchain can be, and shouldn't be since there's no real governance when 70% of the voting power is in the CDC …

[bchooxg]

what kind of vote is this when the cro main controlled validators can come in and veto the vote when all of the community validators voted “No”

Really bad look on CRO and crypto in general