On January 13, Flare shared on Twitter his preparation for the Flare Improvement Proposal 01 (FIP01) vote.
Flare said the 66 percent threshold needed to activate the voting process had been reached. Consequently, holders of Flare Network’s native token, FLR, will officially start voting on FIP01 after the seven-day notice period.
Even with this development, the Flare Foundation cleared up that the initial FLR distribution methods for FLR 4.278b will remain as they are. By the time voting begins, 15% of the total FLR supply will have been distributed.
Meanwhile, Flare is putting together guides and information for holders planning to vote. Between the FLR token distribution event and the day of the vote, Flare will have calculated the applicable inflation rate.
FIP01 Details
FIP01 is a proposal by the Flare Foundation that will affect the payment structure and tokenomics of FLR. The proposal needs a simple majority of votes of FLR holders to pass.
The Flare Foundation and the Flare VC Fund are not eligible to participate. Under the bill’s guidelines, these entities must have deposited their FLR holdings before voting day. In this way, FLR retail holders, which represent 15 percent of all coins in circulation, will be the only ones allowed to vote.
FIP01 is controversial, judging by the community reaction and headlines. In the midst of this talk, Flare believes that implementing this improvement proposal is critical to the long-term success of the project. The team assesses that Flare has grown in the past two years and is “a radically larger project than originally envisioned.” The implementation of FIP01, they add, will change the distribution of tokens “so that it offers participants from any chain and new entrants to the space the same opportunities to become participants in the Flare ecosystem and help it grow.”
What brings FIP01
There are changes to how FLR distribution will be done should FIP01 be approved. For example, the Flare Foundation said that people would not have to rely on centralized platforms like Binance or Uphold to receive tokens. FLR holders will also be able to delegate and receive a portion of the FLR distribution. It means there is a better chance of removing excess liquidity and creating more capital among holders.
Additionally, the Flare Foundation indicated that users who choose to stake more FLR will receive more rewards than in the current setup. Additionally, Flare explains that FIP01 allows holders to have more control, allowing them to post taxes when it suits them best.
