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Optimism Supply growth rate: Can OP token recover from 20% inflation ‘error’?

By Alara Jordan

09:53, 14 October 2022

Layer-2 scaling solution Optimism
Optimism Governance took to Twitter to ensure users that they'll be updating the contract logic to the intended 2% – Photo: Shutterstock

The Layer-2 scaling solution Optimism, which is built on top of the Ethereum blockchain, has had to apologise after announcing that the total supply of its token would inflate at a rate of 20% per year, instead of the correct figure, 2%. 

Optimism Governance took to Twitter to ensure users that it will be updating the contract logic to the intended 2%.

It said: “There was, and will be, zero impact to the planned token supply as a result of this fix. Inflation of OP does not begin until next year. No new tokens have been minted or moved, and no tokens were ever at risk.”

Optimism’s website claims its a fast, stable, and scalable layer-2 blockchain “built by Ethereum developers, for Ethereum developers.” It says it aims to be a minimal extension to existing Ethereum software in order to tackle the speed of transactions, one of the most pressing issues surrounding cryptocurrencies and high-volume blockchains.

In September 2022 the popular NFT marketplace OpenSea announced that it would add Optimism on its platform in a bid to support new collections and projects on its platform.

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The blockchain tweeted: “OpenSea has officially dropped anchor on Optimism! The best part: knowing OpenSea activity on Optimism funds a sustainable future for Ethereum.”

Optimism’s token $OP dipped in price on 10 October, dropping from around the $0.82 mark to a low of $0.74, according to data from CoinMarketCap

At the time of writing, the price of $OP was trading around $0.74, up 8.17% in the previous 24 hours.

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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