Solana’s SGP-0002 “Double Disinflation” proposal passed with 67.0% of the vote, narrowly clearing the 66.67% supermajority threshold. As the first binding vote under the Solana Governance Proposal (SGP) framework, it drew 1,326 votes, representing 60.7% participation among eligible stake.
The new measure increases Solana’s annual disinflation rate from 15% to 30%. While the terminal 1.5% inflation target remains unchanged, the timeline to reach it has been accelerated by three years, moving from 2032 to 2029.
The supply reduction carries a dual impact across the ecosystem. The network is projected to mint 18.9 million fewer SOL over the next six years. Consequently, validator staking yields are anticipated to fall from 5.25% to around 2.25% over a three-year period.
Kraken’s Last-Minute Maneuver
The passage of SGP-0002 was largely decided by voting shifts in the final hours. Kraken initially opposed the inflation reduction proposal. However, the exchange flipped its 8.92 million SOL voting weight to support after urging from Helius CEO Mert Mumtaz.
“Custodians should be conduits, not voices,” wrote Kraken Co-CEO Arjun Sethi, explaining the reasoning behind the vote flip.
A similar dynamic played out among other institutional participants. Galaxy, which initially abstained, voted in favor during the final hour. DeFi Development Corp backed all three proposals and purchased 19,000 SOL worth $1.86 million after voting closed. In contrast, Solana Company (HSDT) approved the new constitution but firmly rejected both economic proposals.
Diverging Fates for Two Other Proposals
The voting round yielded different outcomes for two companion proposals. SGP-0001, establishing the Solana Constitution, passed with overwhelming 86% approval.
Meanwhile, SGP-0003, which aimed to raise the Resource and Inclusion Fee, failed to pass. The proposal to increase transaction fee burns by 12-14x fell short with only 53.9% approval, missing the 66.67% requirement. SGP-0003 had sought to boost the daily burn from 650 SOL to 9,000 SOL, valued at $668,000.
An Early Governance Test
The voting activity took place alongside continuing institutional capital inflows. The Bitwise Solana ETF recently crossed $1 billion in total assets under management.
The lobbying between key stakeholders and last-minute institutional shifts offer crucial lessons for network developers. On-chain voting is no longer a passive process, but a battleground where token holders actively shape monetary velocity and ecosystem staking yields.
Source: Decrypt.
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Previously: Solana Votes on 14x Fee Burn and Inflation Cut - But Its Own Treasury Operator Rejects It
Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
