Solana Vote Puts Faster Disinflation Ahead of $800K Supply-Burning Proposal

Solana’s first onchain governance process has reached the required participation level for all three proposals, but the two measures focused on SOL supply remain unsettled. The plan to speed up disinflation is narrowly above the passage threshold, while the proposal to dramatically increase SOL burns still lacks the two-thirds backing required for approval.

The votes center on two different strategies for slowing SOL’s supply expansion. One would reduce the rate at which new SOL is issued, while the other would increase the amount of SOL permanently destroyed through transaction fees.

Solana generates new SOL as rewards for validators and other participants that help secure the blockchain. Reducing issuance would limit the number of new tokens entering circulation, while higher burn activity would remove more existing tokens. Together, the measures could reduce the dilution experienced by current SOL holders.

The proposals are being considered through Solana’s first onchain governance system, giving validators and stakers a formal role in deciding major changes to the network’s economics and functionality.

One of the proposals would change how transaction fees are calculated by tying charges to the computational resources consumed. The portion linked to that computational demand would then be burned. If adopted, daily SOL burns could climb from roughly 650 tokens to between 7,500 and 9,000.

At prices seen this week, 9,000 SOL would represent approximately $800,000 worth of tokens burned every day. Even so, that would remain significantly below the roughly 60,000 SOL currently created on the network each day.

How the Solana Votes Are Decided

Each proposal needs participation from at least one-third of Solana’s total staked network weight. It must then secure support from two-thirds of the participating stake.

Abstentions help a proposal satisfy quorum but are excluded from the affirmative vote count. As a result, a large number of abstentions can make it more difficult to reach the final approval threshold.

According to Solana’s governance data, all three proposals had achieved quorum by Friday.

Solana Governance Proposals at a Glance

SGP-0001, the network’s proposed “constitution,” has received overwhelming approval. It defines the rules for Solana’s governance framework, including participation, voting power and passage requirements. Support currently stands at 95.35%, with only 0.22% opposed.

SGP-0002 has crossed the approval line, but only narrowly. The measure would accelerate Solana’s annual reduction in new SOL issuance from the current 15% pace to 30%.

It has 68.77% support and 47.72% participation. If implemented, the network would reach its long-term minimum issuance rate of 1.5% around 2029 rather than 2032.

The change would mean approximately 18.9 million fewer SOL are created over six years.

SGP-0003 is in a weaker position. The proposal would modify Solana’s transaction-fee system and significantly increase the amount of SOL burned.

It currently has 62.72% support, compared with 16.52% opposition and 20.75% abstention. Participation is 42.51%, leaving it below the two-thirds approval requirement.

The proposal’s high abstention level could further complicate its path to passage because those votes count toward quorum but provide no support toward the two-thirds threshold.

Solana Company Opposes Supply Changes

The proposals targeting SOL’s supply dynamics have also drawn criticism from Solana Company, the Nasdaq-listed SOL treasury firm that trades under HSDT.

The company said on Aug. 21 that it backed SGP-0001 but opposed SGP-0002 and SGP-0003. Its position was based on the argument that institutional investors require greater predictability around network economics when making plans over several years.

The governance period was initially expected to close around Thursday afternoon UTC but remained active Friday as the final epoch continued. Solana votes run across three epochs, whose duration is determined by blockchain production rather than a fixed time period.

Even if either supply proposal passes, the changes would not be implemented immediately. A successful vote establishes a mandate to proceed, while the necessary code and technical upgrades must still be developed and deployed separately.