Recycling
The process of removing TAO from the total issuance count, effectively returning it to the unissued supply. Recycled TAO can be emitted again in future blocks.
When TAO is recycled, it gets subtracted from the blockchain's total issuance. This means the recycled TAO no longer counts as "in circulation" for the purpose of calculating the emission rate. Since halving is triggered by the total issuance, recycling pushes those thresholds further away.
Think of it as putting tokens back into the unissued emission pool. These tokens will be emitted again over time.
Several actions recycle TAO by reducing the total issuance:
- A portion of subnet creation costs (the part not used as initial pool liquidity)
- Hotkey swap fees
- Coldkey swap fees
ALPHA RECYCLING
Subnets also have a separate recycling mechanism for their ALPHA tokens. When ALPHA is recycled, it reduces the subnet's outstanding ALPHA supply. This does not affect TAO issuance or halving (it only affects the ALPHA token within that specific subnet).
The more TAO that gets recycled, the slower the total issuance grows, and the longer it takes to reach each halving threshold. This means the actual timing of each halving is not fixed (it depends on how much activity generates recycling).
Periods of high subnet creation and key swapping produce more recycling, pushing halvings further into the future.