Solana Validators Vote on Proposals to Cut SOL Supply

Solana validators have begun voting on three major governance proposals, including two measures designed to reduce the amount of SOL entering circulation and potentially increase the token’s burn rate.

Voting started Sunday and is scheduled to run until Thursday at around 15:30 UTC. Votes are weighted according to the amount of SOL staked, giving voting power to validators as well as token holders who delegate their SOL to validators.

Two proposals focus directly on Solana’s token supply. SGP-0002 would accelerate the network’s declining inflation schedule. Solana currently reduces new SOL issuance by 15% annually, but the proposal would double that reduction rate to 30%, allowing issuance to reach its minimum level sooner.

SGP-0003 targets Solana transaction fees and token burns. Under the proposal, transaction costs would be divided into two components. A fixed fee would be paid to the validator producing the block, while another fee based on the computational resources used by the transaction would be permanently burned.

The change could significantly increase the amount of SOL removed from circulation each day. Estimates suggest daily SOL burns could climb from roughly 650 tokens to between 7,500 and 9,000 SOL.

Together, the proposals could tighten Solana supply by slowing new token issuance while simultaneously destroying more existing SOL. However, neither measure directly addresses demand for the cryptocurrency.

The third proposal, SGP-0001, would formally establish the “Solana Constitution,” outlining the network’s governance procedures and activating the software used to conduct validator votes. Until now, major Solana changes have largely been coordinated informally among developers and major network operators.

The simultaneous votes have created an unusual governance situation because SGP-0001 seeks to formally approve the voting framework already being used to decide SGP-0002 and SGP-0003.

SOL traded above $96 early Monday, gaining about 1.6% over the previous 24 hours. The cryptocurrency has surged approximately 28% over the past week as investors monitor the governance votes and their potential impact on Solana’s long-term token supply.