Solana Validators Back Proposals to Cut SOL Supply Through Burns and Lower Inflation

Solana validators have signaled support for two governance proposals that could cut down on SOL supply by increasing token burns and reducing inflation.

The proposals, SIMD-0553 and SIMD-0550, aim to reduce SOL entering circulation while increasing the amount permanently removed from the supply. SIMD-0553 introduces a resource-based fee model that charges users according to computing resources consumed by their transactions.

If approved, SIMD-0553 would increase Solana's daily token burn from around 650 SOL to between 7,500 and 9,000 SOL, a tenfold increase. Meanwhile, SIMD-0550 would double the network's annual disinflation rate to 30%, allowing it to reach its long-term inflation floor of 1.5% in 2029 instead of 2032.

The proposals have cleared Solana's validator support threshold and entered into the discussion phase. According to the Solana Validator Governance portal, both proposals have secured 65.22 million SOL in support, representing 15.01% of the staked SOL.