Injective community approves proposal to cut INJ token supply

The Injective community has approved a major tokenomics overhaul after a governance proposal passed with 99.89% support based on staked voting power.

The proposal, known as Supply Squeeze or IIP-617, reduces INJ token issuance while maintaining the network’s existing buyback-and-burn mechanism.

Injective said the updated model aims to accelerate the removal of tokens from circulation by combining lower issuance with recurring buybacks funded by protocol revenue.

Around 6.85 million INJ tokens have already been permanently removed from supply through previous burn events.

In a post on X, Injective stated the changes would allow “INJ to become one of the most deflationary assets over time.”

The vote comes as INJ continues to trade significantly below past highs following a prolonged downturn across the broader altcoin market.

Over the past year, INJ has fallen nearly 80% and remains more than 90% below its all-time high reached in March 2024.

Market data showed INJ was down roughly 8% on Monday, reflecting continued selling pressure despite the governance approval.

Community reactions on social media were largely positive, with many users describing the proposal as a long-term structural shift rather than a short-term price driver.

Injective’s total value locked stood at $18.67 million, down sharply from peaks above $60 million in 2024, according to DefiLlama data.

Despite weaker metrics, Injective has continued to attract institutional interest through ETF filings, validator growth and new market initiatives.

In July, Cboe and Canary Capital filed applications for a staked Injective exchange-traded fund designed to hold and stake INJ.

The network has also expanded its validator set, adding Deutsche Telekom’s IT subsidiary earlier this year.

Korea University recently became the first academic institution to operate a validator and conduct onchain research on Injective.

At the time of reporting, Injective price was $4.82.