Kraken's Last-Minute Vote Switch Secures Narrow Win for Solana Disinflation Proposal

A Solana governance proposal, SGP-0002, has passed with a razor-thin margin of 67% to 33%, doubling the network's disinflation rate from 15% to 30%. This change instructs the network to create new SOL but shrink the inflation rate twice as fast.

The outcome was largely influenced by Kraken's switch in vote at the last minute, with its 8.9 million SOL validator casting 90.34% of its stake in favor of the measure. The exchange supplied enough 'yes' votes to secure a winning margin and was widely credited on social media with flipping the vote.

Despite this change, Solana will still remain inflationary at a positive rate. The doubling of the disinflation rate doesn't flip the rate of new SOL entering the market negative; rather, it accelerates the timeline for reaching the terminal (or 'long tail') inflation rate of 1.5%. This is estimated to occur in approximately 2.8 years after activation, instead of 5.7 years.

Developers must now re-anchor the supply curve, test the change, and activate its feature gate before the vote takes effect. The proposal was the first Solana governance proposal to pass under the network's new binding, on-chain voting system.