To enhance the economics around the Solana protocol, the community’s validators will decide on a crucial update that can shift the SOL inflationary model
The Solana community is preparing to vote on Solana Improvement Document SIMD-228. According to reports, the proposal could significantly change how new SOL tokens are issued.
A Shift Toward a Market-Driven Model
Notably, Tushar Jain and Vishal Kankani from Multicoin Capital introduced the proposal, with contributions from Max Resnick of Anza.
The goal is to move away from Solana’s fixed inflation model and adopt a system where token emissions adjust based on staking participation.
SIMD-0228:
As we head to the vote in epoch 753, I am proud to share that we have spent almost two months discussing SIMD-0228 in public. (Check screenshot for details).
Throughout the process, we incorporated several pieces of community feedback:
1. Transitioned from a… pic.twitter.com/0g138cFGY8
— Vishal Kankani (@kankanivishal) March 6, 2025
Solana’s inflation rate starts at 4.6% per year and decreases by 15% annually until it stabilizes at 1.5%. The proposed model would instead adjust emissions depending on how much SOL is staked.
If staking levels drop below 33%, more tokens will be issued to encourage participation. When staking is high, emissions will decrease, reducing inflation and increasing the scarcity of SOL.
Similarly, community members believe this system would make Solana’s economic model more efficient. It will prevent unnecessary inflation and better align rewards with network security needs.
In addition, reducing emissions when staking is high could make SOL more valuable in the long run.
However, concerns have been raised about the impact on validators and investors who depend on predictable staking rewards.
Some believe the change could make it harder for smaller validators to compete and discourage institutional investors from engaging with Solana’s ecosystem.
Mixed Reactions from the Solana Community
The proposal has sparked debate among key figures in the Solana ecosystem. Some industry leaders consider it an essential step toward a more sustainable economic model. Others worry that fluctuating staking rewards could introduce uncertainty and make participation less attractive.
The proposal’s authors maintain that it has been thoroughly discussed over the past two months and has considered different perspectives.
Still, some community members feel that more evaluation is needed before making such a fundamental change.
Validators are expected to vote during epoch 753, which could be anytime this weekend. The outcome will determine how Solana adjusts token emissions in the future. The results could have a lasting impact on the network’s staking incentives and overall economic model.
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