What Is the Impact of a Deflationary Vs. Inflationary Token Model?

A deflationary model reduces the total token supply over time (e.g. via token burns), aiming to increase scarcity and price. An inflationary model continuously increases the supply (e.g. via staking rewards or block rewards), which can lead to price depreciation unless demand grows faster than supply.

The choice depends on the project's goal: value store (deflationary) or network activity (inflationary).