Solana Governance Experiment Ends with Controversial Outcome: Two Proposals Pass, One Sparks Heated Debate

Solana's first on-chain governance vote has concluded, marking a milestone in its development. On August 23rd, three proposals simultaneously entered voting: SGP-0001, which establishes a formal governance framework; SGP-0002, which aims to accelerate the reduction of inflation from 15% to 30%; and SGP-0003, which restructures transaction fees.

SGPs are Solana's attempt at on-chain governance. The three proposals will now proceed, with SGP-0001 and SGP-0002 passing due to meeting the minimum 25% of staked SOL participants voting and 66.6% support threshold. However, SGP-0003 failed to pass, with a 54.3% approval rate.

SGP-0001 establishes a formal governance framework for Solana. It allows proposals that gain at least 15% of staked SOL support to enter voting, which is weighted by the amount of SOL staked. SGP-0002 aims to accelerate the reduction of inflation from 5.7 years to 2.8 years, leading to a potential decrease in 18.9 million SOL's annual issuance.

However, SGP-0003, which restructures transaction fees, was met with significant opposition. The new fee structure separates fixed charges into two components: one for producers and one based on resource consumption. Proponents argue that this would increase the destruction of SOL by 10 times, but opponents claim it is a disguised tax, as higher costs could deter users.