Solana Supply Vote Diverges: Proposal with 69% Support Leads, Burn Plan Below Threshold

While a proposal to more rapidly reduce new token issuance in Solana takes the lead, the plan aimed at increasing daily burns has yet to find the necessary support.

Participants managing and staking on the Solana network are voting between two different ways to reduce the SOL supply. According to data reported by CoinDesk, the proposal coded SGP-0002 is leading with 68.77% support. SGP-0003, which aims to burn more SOL from transaction fees, remains at 62.72%, falling below the two-thirds approval level required for passage.

The votes are being conducted as part of Solana’s first on-chain governance process. The network produces new SOL every day to reward validators. Therefore, a slower release of new tokens could ensure that existing holders’ shares in the total supply are less diluted. However, the voting process is not yet complete, and the proposals do not create an automatic change in the network at this stage.

Two proposals to reduce SOL supply have diverged

SGP-0002 aims to increase the annual reduction in the new SOL issuance rate from 15% to 30%. If the plan is accepted, Solana is expected to bring its annual new token issuance down to the minimum level of 1.5% around 2029. Compared to the current schedule, approximately 18.9 million fewer SOL could be produced within six years.

SGP-0003, on the other hand, aims to burn a specific portion of fees entirely by adjusting transaction fees based on the computational power consumed by the network. This change could increase the daily burn from approximately 650 SOL to 7,500-9,000 SOL. In the upper scenario, this amount is worth approximately $800,000 at current prices. However, the network producing approximately 60,000 new SOL daily indicates that the burn amount alone will not completely eliminate the supply increase.

For the proposals to pass, at least one-third of the network stake must participate in the vote, and two-thirds of the participating stake must provide support. Abstaining votes are included in participation, but are not added to the approval rate. All three proposals have surpassed the participation threshold. In SGP-0003, the share of abstainers reached 20.75%, while total participation stands at 42.51%. Even if approved, technical changes will need to be written and implemented separately.