Key facts
- Solana validators are considering a proposal to increase daily SOL burns through a new fee model.
- A companion proposal would accelerate the network's declining inflation schedule.
- The proposal aims to increase daily SOL burns from approximately 650 SOL to between 7,500 and 9,000 SOL.
- The proposal would also double Solana's annual disinflation rate to 30%, bringing its 1.5% inflation floor forward from 2032 to 2029.
- The proposal requires support from 15% of the network's staked supply to advance to a formal vote.
Solana validators are close to advancing a governance proposal that would significantly increase the amount of SOL burned daily and accelerate the network's disinflation schedule. The proposal, SGP-0003, combines two Solana Improvement Documents (SIMDs) into a single package. SIMD-0553 introduces resource-based transaction fees, which could increase daily SOL burns from approximately 650 SOL (about $48,000) to between 7,500 and 9,000 SOL (up to about $668,000), depending on network activity. SIMD-0550 would double Solana's annual disinflation rate to 30%, bringing the network's 1.5% inflation floor forward from 2032 to 2029. Token burns permanently remove cryptocurrency from circulation, and by pairing larger burns with lower issuance, the proposal aims to reduce the growth of SOL's circulating supply. The proposal is currently in Solana's support phase, requiring backing from 15% of the network's staked supply before advancing to a formal vote. As of Tuesday morning, it had support from 14.4% of the staked supply, with about 3 million SOL needed before the August 18 deadline. Major supporters include Helius, Jupiter, and OtterSec.