Part 10/15:
The discussion highlights an often-overlooked aspect: tokenomics and inflation. When staking rewards are high, they can be driven by inflation, which dilutes token value. For example, chains offering 25% APY may sustain rewarding staking through inflationary mechanisms, but if token inflation outpaces returns, net gains diminish.
This dynamic impacts investor behavior, especially when real yields (net of inflation) approach zero or negative. Since many chains rely on inflation to fund rewards, understanding the net inflation—the true measure of value preservation—is critical for assessing long-term viability.