Solana validators are considering a governance proposal to increase daily SOL burns more than 10-fold while reducing new token issuance.
Regulation & Gov ·
Solana validators are advancing a governance proposal that would substantially increase daily token burns while simultaneously reducing new SOL issuance. Proposal SGP-0003 combines two separate improvement documents: SIMD-0553 would introduce resource-based transaction fees that lift daily SOL burns from approximately 650 SOL to between 7,500 and 9,000 SOL depending on network activity, while SIMD-0550 would double the network's annual disinflation rate to 30%, moving Solana's 1.5% inflation floor from 2032 to 2029. Together, these changes aim to constrain SOL supply growth by removing more tokens from circulation while issuing fewer new ones.
As of mid-August, the proposal had secured backing from 63 million SOL—just over 14.4% of staked supply—leaving roughly 3 million SOL needed to reach the 65.16 million threshold before the Aug. 18 deadline. The proposal currently has 73 validator supporters including Helius, Jupiter, and Staking Facilities. Once the support threshold is met, the measure will enter a discussion phase before advancing to a formal validator vote.
Several key mechanics remain unresolved. The higher burn rate alone would not render SOL deflationary given current daily issuance of around 60,000 SOL, making the companion issuance reduction essential to the proposal's supply-tightening effect. Market impact and long-term price dynamics depend on whether demand responds to constrained supply and how validators ultimately weigh economic and technical tradeoffs.