NEAR Proposes $57 Million Sovereign Fund to Cut Inflation

NEAR Protocol co-founder Illia Polosukhin has proposed creating a protocol sovereign fund, which would use roughly 30 million NEAR tokens as its initial capital base. This proposal aims to reduce inflation and create a sustainable funding source for the network.

The proposed fund would combine existing protocol revenue with future earnings, holding them in NEAR and generating yield through strategies defined by governance. The plan is to direct current and future protocol revenue into a NEAR-denominated fund, using part of the yield to pay for network security, validator support, and multiparty computation providers.

Polosukhin argued that burning revenue only provides temporary supply reduction, while his proposal seeks to use revenue to acquire NEAR, generate yield, and create a continuing funding source. If successful, this could lead to reduced inflation or even a fixed token supply.