PANews reported on March 13 that according to CoinDesk, Solana's SIMD-0228 proposal could lead to a significant drop in SOL's inflation rate. As of press time, the proposal has received support from 37.8% of network validators. According to Dune Analytics, 746 validators (equivalent to nearly 58% of the total 1,334 active validators) have voted on the proposal. 37.8% voted in favor of the proposal, 18.5% opposed, and 1.2% abstained. Overall, as of the time of writing, the proposal appears to be on the verge of failure. The vote will end at Epoch 755, which is scheduled to be reached in about 11 hours.
The proposal advocates a market-based token issuance mechanism to ensure that the network does not overpay for security, and is expected to have a positive impact on Solana-based decentralized finance and promote liquidity in the on-chain SOL market. According to some estimates, the proposal could reduce SOL's inflation rate from 4.5% to about 0.87%, a reduction of 80%.
Tagus Capital expects this to have a positive impact on the price of SOL. The company said in a newsletter on Thursday: "If approved, it will significantly reduce staking rewards and new SOL supply, potentially boosting its value. However, lower rewards may force smaller validators to exit, raising concerns about the decentralization of the network. However, lower rewards may force smaller validators to exit, raising concerns about the decentralization of the network."
