$CHZ soars 35% after Dragon8 hard fork launch

New tokenomics plan initiates inflation reduction from 8.80% annually to 1.88% over 14 years, increasing maximum supply to 15bn tokens

The Chiliz ($CHZ) token jumped by 35% following the launch of the Dragon8 hard fork on the testnet on April 29. This increase came as a relief after the cryptocurrency experienced a correction period lasting nearly two months, prompting questions about the completion of the correction cycle.

The Dragon8 hard fork, announced by Chiliz back in February as part of its 2024 roadmap, introduces several key changes to the tokenomics of $CHZ. One major adjustment involves a gradual reduction in inflation and the implementation of a burn mechanism.

The circulating supply of $CHZ has already reached its maximum of 8.888bn tokens, leading to the introduction of a new tokenomics structure aimed at rewarding ecosystem contributors and ensuring sustainable expansion.

Under the new tokenomics plan, inflation will begin at 8.80% and decrease annually, eventually reaching 1.88% after 14 years. This alteration also increases the maximum supply to 15bn tokens, with a distribution plan allocating 65% to validators, 25% to the ecosystem, and 10% to the community vault.

In addition to these changes, clubs will now serve as validators on the Chiliz chain, and a decentralized exchange called JalaSwap is set to launch.

Paris Saint-Germain has committed to becoming the first team to operate as a node validator and has pledged to conduct regular buybacks of its fan token using revenue generated from the exchange, aiming to reduce supply and bolster token value.

With the Dragon8 hard fork successfully deployed on the testnet, Chiliz enthusiasts are optimistic about the future of the cryptocurrency. The implementation of the burn mechanism, which will involve burning gas fees and offering an 11.44% annual percentage yield (APY) for validators, aims to incentivize community participation and ensure long-term ecosystem funding.

Technical analysis indicates that $CHZ has bounced back from long-term horizontal and diagonal support levels, suggesting a potential end to the correction period. However, mixed readings from technical indicators warrant cautious optimism. While the MACD and RSI show signs of improvement, further analysis on daily time frames is needed to confirm the direction of the trend.

As $CHZ continues its upward momentum, eyes are set on key resistance levels at $0.12 and $0.16. A successful breakout above these levels could solidify the end of the correction cycle and pave the way for a new yearly high.

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Written by Silvia Pavlof

Silvia has explored various forms of writing, ranging from content creation for social media to crafting movie scripts. Drawing on her experience as a journalist specializing in the gambling sector, she is currently investigating the impact of cryptocurrencies and blockchain on traditional gambling and iGaming.

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