Celestia’s TIA Token Surges 26% on Inflation Cut Proposal

Celestia’s modular blockchain solution has once again captured market attention, with its native token, TIA, experiencing a significant rally. Over the past week, TIA has surged by 26%, reaching $1.56 as of July 8. This sharp increase has reignited interest in the project’s long-term vision and its current fundamentals. Several factors, including a new proposal to reduce inflation, growing developer adoption, and attractive staking rewards, are contributing to the strengthening case for continued upside.

One of the key drivers behind this rally is a community proposal aimed at reshaping Celestia’s tokenomics. The proposal suggests reducing TIA’s annual inflation from 8% to 0.25%, which would dramatically tighten the future supply of the token. This news was met with immediate market enthusiasm, pushing the token up by 11.6% within 24 hours of the announcement. If passed, the inflation change could become effective in Q3 2025 and is designed to increase long-term value capture for both stakers and holders. Blockchain analyst Elijah Barrett commented, “Cutting inflation is a game-changer. Investors are hunting scarce assets again, and Celestia is delivering a compelling narrative, low inflation and high yield in one package.”

Despite the proposed inflation drop, Celestia continues to offer some of the most competitive staking yields in the Layer-1 space. According to data from StakingRewards, the current annual percentage yield (APY) stands at 11.8%, and over 38% of TIA’s circulating supply is already staked. This significant portion of tokens being locked reduces market liquidity, which can amplify price moves during bull markets.

Celestia’s rally is not solely driven by tokenomics; its underlying technology is also attracting developers building modular chains. The upcoming “Lotus” testnet upgrade, expected this month, will add native interoperability for zk-rollups—one of the most sought-after tools for scaling Ethereum-compatible applications. Daisy Chen, CTO of a Cosmos-based DeFi startup, noted, “Developers want modular infrastructure that’s fast, scalable, and plug-and-play. Celestia’s ahead of the curve, especially now with Lotus making rollup deployment seamless.” Several projects have reportedly begun migrating their rollup layers to Celestia for improved data availability and lower fees.

From a technical perspective, TIA has broken out of a six-week downtrend, closing above its descending resistance line. The next significant challenge is $1.71, which aligns with the 50-day moving average. A break above this level could open a pathway toward $2.26, the previous high from late April. Crypto trader Michaël van de Poppe tweeted, “TIA looks primed to rip. A clean break of $1.70, and we could be on track for $2.20–$2.30 quickly.”

Market analysts are now re-evaluating their price targets for TIA. The base case scenario predicts a price range of $2.00–$2.26 by mid-August if bullish momentum sustains above $1.71. The bull case scenario projects a price of $3.00 by September if Lotus adoption accelerates and the inflation proposal passes. Conversely, the bear case scenario suggests a drop back to $1.35 if resistance at $1.71 fails and macro sentiment sours. CoinStats also suggests that Celestia could trade between $6.24–$7.50 by year-end if modular blockchain adoption continues and a European-based ETP listing materializes.

In conclusion, Celestia’s TIA token is more than just another altcoin riding market waves; it represents a strong case study of how a compelling mix of real fundamentals, token economics, and technology can fuel sustainable rallies. With inflation cuts, staking incentives, and rising developer interest all working in tandem, the $2.26 resistance level might not hold for long. As long as macro sentiment remains neutral and developer traction increases, TIA appears poised to regain, and perhaps surpass, its earlier highs.