# Deflationary Model

The GAYA blockchain implements a deflationary model to maintain token scarcity and drive long-term value appreciation. This model leverages fee-burning mechanisms and scheduled reductions in token supply.

1. Transaction Fee Burns: A portion of the gas fee from every transaction is burned, permanently removing those tokens from circulation. This approach ties deflationary pressure directly to network activity, ensuring scalability aligns with token value.\
   \
   Formula for Burned Tokens per Transaction:

Burned Tokens = Base Fee × Gas Used

* Base Fee: Dynamic fee determined per block, adjusted based on network demand.
* Gas Used: Amount of computational resources consumed by the transaction.

Scheduled Token Burns: Periodic token burns are executed based on governance proposals and protocol milestones, targeting reserve tokens or collected fees.<br>


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