Solana proposal to reduce inflation rate by up to 80% fails

From Cointelegraph

March 13, 2025 10:51:45 pm:

A proposal to change Solana’s inflation system was rejected by stakeholders, a victory for the network’s governance process. The proposal, SIMD-228, saw 74% of the staked supply vote, but only 43.6% in favor, falling short of the 66.67% needed to pass. This was the biggest crypto governance vote ever, with high voter turnout.

SIMD-228 aimed to switch Solana’s inflation model to a dynamic, market-based system from a fixed schedule. The current system has an 8% annual inflation rate decreasing by 15% yearly until 1.5%. Estimates suggest the new model could reduce inflation by up to 80%. The proposal sought to stabilize the network and increase DeFi use.

While the proposed change could enhance network security and encourage more SOL use in DeFi, it may have made it harder for smaller validators to stay profitable. Despite the rejection, SOL prices saw little reaction, dipping 1.5% to just under $125. The asset has dropped nearly 60% in two months due to the memecoin bubble burst.

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