The Aptos ecosystem faces the challenge of inflation governance, and the AIP-119 proposal has sparked heated discussions in the community.

The Aptos community has recently been embroiled in intense debate over a proposal AIP-119 that aims to reduce staking rewards. The proposal suggests gradually lowering the staking reward rate from around 7% to 3.79% over the next three months to alleviate APT inflationary pressures. Supporters argue that this is a necessary step to curb inflation and activate ecosystem liquidity, while opponents worry that this move could undermine the decentralized foundation of the network and even lead to capital outflows.

Proponents of the proposal point out that lowering staking rewards can not only quickly alleviate APT inflation but also encourage users to invest their funds in other on-chain DeFi activities instead of relying solely on passive staking. However, dissenting voices cannot be ignored. Some are concerned that a significant reduction in staking rewards will severely impact small validators, potentially forcing them to exit the network due to an inability to cover operational costs, which could indirectly weaken the level of decentralization of Aptos.

Analysis indicates that the reduced staking yield may lack competitiveness, appearing less attractive compared to chains like Cosmos. This could lead some investors to shift their funds to other networks, affecting Aptos's TVL and liquidity. At the same time, the lower staking yield may also reduce the appeal of Aptos DeFi protocols to liquidity providers.

In fact, similar governance issues are also common in other PoS public chains. For example, Solana previously proposed a similar measure to curb network inflation by lowering validator yields, but it was ultimately rejected. This reflects the dilemma of interest games in public chain governance, especially prominent in PoS mechanisms.

Comparing the inflation control strategies of several mainstream PoS public chains:

1. Solana adopts a year-over-year decreasing inflation model, with an initial value of 8%, decreasing by 15% each year, currently around 4.58%. The staking ratio is approximately 65%.

2. Sui has set a hard cap of 10 billion SUI, with a relatively low staking yield (2.3%~2.5%), and the staking rate is about 76.73%.

3. The staking yield for Cosmos is as high as 14.26%, with a staking rate of about 59%, but the price of ATOM tokens continues to decline.

4. Ethereum has achieved deflation through the PoS transition and base fee burning, but it has not led to a significant increase in token prices.

Currently, no PoS public chain has perfectly solved the balance between inflation rate and network participation. For Aptos, while considering "throttling" through AIP-119, it is also necessary to weigh its potential impact on the validator ecosystem and network decentralization.

Compared to aggressively cutting rewards, Aptos at the current stage should focus more on how to enhance network activity and attract quality projects to settle in, thereby building a prosperous and sustainable ecosystem. This may be the key to supporting APT's long-term value. After all, Aptos currently has a TVL of only $1.1 billion, ranking 11th among public chains, and there is still room for improvement in overall data. The total number of validators in the network is 149, and there are 495 full nodes, which are not very high.

In summary, Aptos faces a dilemma between austerity and expansion in inflation governance. Finding a balance between controlling inflation and maintaining network vitality will be a key challenge for Aptos's future development.