add psudo code doc for inflation logic

umee-network · Jul 28, 2023 · 4b5e5e0 · 4b5e5e0
1 parent 1995658
commit 4b5e5e0
Showing 1 changed file with 31 additions and 47 deletions.
diff --git a/app/inflation/README.md b/app/inflation/README.md
@@ -44,70 +44,54 @@ inflation_cycle_duration  time.Duration
 inflation_reduction_rate sdk.Dec
 ```
 
-1. `max_supply` : This parameter determines the maximum supply of token. $UMEE max supply is 21 billion tokens.
-2. `inflation_cycle_duration` : This paramter determines the duration of inflation cycle.
-3. `inflation_reduction_rate` (100bp to 10'000bp): This parameter determines the rate at which the inflation rate is reduced. A value of 100bp indicates 1%, 0.1 corresponds to a 10% reduction rate, and 0.01 represents a 1% reduction rate.
+See [Ugov Proto](https://github.com/umee-network/umee/blob/main/proto/umee/ugov/v1/ugov.proto) for inflation params
 
 ### InflationCalculationFn
 
 The inflation calculation logic will be implemented as follows:
 
-```go
-type Calculator struct {
-    UgovKeeperB ugovkeeper.Builder
-    MintKeeper  MintKeeper
-}
+```bash
+Input: sdk.Context, minter, mint module params , bondedRatio
+Output: Inflation 
 
-func (c Calculator) InflationRate(ctx sdk.Context, minter minttypes.Minter, mintParams minttypes.Params,
-    bondedRatio sdk.Dec) sdk.Dec {
+Procedure inflationRate(ctx , minter, mintParams, bondedRatio):
 
-    ugovKeeper := c.UgovKeeperB.Keeper(&ctx)
-    inflationParams := ugovKeeper.InflationParams()
-    maxSupplyAmount := inflationParams.MaxSupply.Amount
+    INFLATION_PARAMS = // GET INFLATION_PARAMS FROM UGOV MODULE 
+    MAX_SUPPLY = // MAX SUPPLY OF MINTING DENOM FROM INFLATION_PARAMS
 
-    totalSupply := c.MintKeeper.StakingTokenSupply(ctx)
-    if totalSupply.GTE(maxSupplyAmount) {
+    TOTAL_TOKENS_SUPPLY =  // TOTAL SUPPLY OF MINTING DENOM 
+    If TOTAL_TOKENS_SUPPLY.GTE(MAX_SUPPLY) :
         // supply has already reached the maximum amount, so inflation should be zero
-        return sdk.ZeroDec()
-    }
+        Return sdk.ZeroDec()
 
-    cycleEnd, err := ugovKeeper.GetInflationCycleEnd()
-    util.Panic(err)
+    INFLATION_CYCLE_END_TIME = // CURRENT INFLATION CYCLE END TIME FROM UGOV STORE 
 
-    if ctx.BlockTime().After(cycleEnd) {
+    If ctx.BlockTime > INFLATION_CYCLE_END_TIME:
         // new inflation cycle is starting, so we need to update the inflation max and min rate
-        factor := bpmath.One - inflationParams.InflationReductionRate
+        factor = 1 - INFLATION_PARAMS.InflationReductionRate // 1 - 0.25 = 0.75
         mintParams.InflationMax = factor.MulDec(mintParams.InflationMax)
         mintParams.InflationMin = factor.MulDec(mintParams.InflationMin)
 
-        c.MintKeeper.SetParams(ctx, mintParams)
-
-        err := ugovKeeper.SetInflationCycleEnd(ctx.BlockTime().Add(inflationParams.InflationCycle))
-        util.Panic(err)
-    }
-
-    minter.Inflation = minttypes.DefaultInflationCalculationFn(ctx, minter, mintParams, bondedRatio)
-    return c.AdjustInflation(totalSupply, inflationParams.MaxSupply.Amount, minter, mintParams)
-}
-
-// AdjustInflation checks if the newly minted coins will exceed the MaxSupply, and adjusts the inflation accordingly.
-func (c Calculator) AdjustInflation(totalSupply, maxSupply math.Int, minter minttypes.Minter,
-    params minttypes.Params) sdk.Dec {
-    minter.AnnualProvisions = minter.NextAnnualProvisions(params, totalSupply)
-    newSupply := minter.BlockProvision(params).Amount
-    newTotalSupply := totalSupply.Add(newSupply)
-    if newTotalSupply.GT(maxSupply) {
-        newTotalSupply = maxSupply.Sub(totalSupply)
-        newAnnualProvision := newTotalSupply.Mul(sdk.NewInt(int64(params.BlocksPerYear)))
-        // AnnualProvisions = Inflation * TotalSupply
-        // Mint Coins = AnnualProvisions / BlocksPerYear
-        // Inflation = (New Mint Coins * BlocksPerYear) / TotalSupply
-        return sdk.NewDec(newAnnualProvision.Quo(totalSupply).Int64())
-    }
-    return minter.Inflation
-}
+        MintKeeper.SetParams(ctx, mintParams)
+
+        // SET CURRENT NEW INFLATION CYCLE END TIME IN UGOV STORE 
+        CYCLE_END_TIME = ctx.BlockTime().Add(INFLATION_PARAMS.InflationCycle)
+
+    Inflation = minttypes.DefaultInflationCalculationFn(ctx, minter, mintParams, bondedRatio)
+
+    // if the newly minted coins will exceed the MaxSupply, and adjusts the inflation accordingly.
+    MINTING_COINS =( Inflation * TOTAL_TOKENS_SUPPLY )/ mintParams.BlocksPerYear
+    IF (MINTING_COINS + TOTAL_TOKENS_SUPPLY) > MAX_SUPPLY:
+        MINTING_COINS = MAX_SUPPLY - TOTAL_TOKENS_SUPPLY
+        Return Inflation = (MINTING_COINS * mintParams.BlocksPerYear) / TOTAL_TOKENS_SUPPLY
+
+    Return Inflation
+
+End Procedure
 ```
 
+[Please Check here](https://github.com/umee-network/umee/blob/main/app/inflation/inflation.go) for above psudo code implementation
+
 ## Conclusion
 
 The UMEE Tokenomic Restructuring proposal aims to optimize the $UMEE token economics, providing a dynamic and adaptive mechanism for inflation adjustment based on the network's bonding rate. The proposed changes will support the growth of the Umee ecosystem and enhance the overall staking experience for validators and delegators. Umee governance retains the ability to adapt the inflation schedule if required to respond to external changes in the future.