Solana Validators Back Proposal to Boost Daily SOL Burns

Solana validators are backing a new proposal that could significantly impact the token's economy. The proposal, called SIMD-0553, would introduce resource-based transaction fees, where users pay based on network resources used rather than a flat fee per transaction.

As a result of this change, daily SOL burns could increase from around $47,000 to as much as $650,000 while reducing new token issuance. Another proposal, SIMD-0550, aims to reduce Solana's inflation rate by doubling the annual disinflation rate from 15% to 30%, allowing the network to reach its long-term target of 1.5% inflation by 2029 instead of 2032.

The two proposals work together to slow down SOL supply growth. However, even with increased burns and reduced issuance, new tokens would still be created at a higher rate than burned, keeping the network from becoming deflationary right away.

Validators need to show enough support through Solana's governance process before the proposal can move to a final vote. Currently, around 24.94 million SOL has been pledged in support, representing about 5.8% of all staked SOL. The proposal needs nearly 40 million more SOL to reach the required 15% threshold by August 18.