- The SIMD-228 proposal to reform the inflation rate failed to pass in the voting system.
- The proposal aimed to change the inflation system from pre-set to a dynamic based on staking participation.
The Solana community agreed to introduce the SIMD-228 proposal to change its current inflation rate system. After the final vote today, the proposal failed to pass with only 61.4% votes. Despite the rejection of the proposal, the Solana voting system is garnering attention across the industry.
Around 910 validators, amounting to 74% of staked supply, voted on the new proposal. While 43.6% of them voted in favor of the proposal, 27.4% voted against it. Dune Analytics also revealed that 3.3% of validators abstained. Thus, the proposal only received 61.4% whereas it required 66.67% to pass.
What is the SIMD-228 proposal?
The current proposal aims to introduce a dynamic inflation system based on staking participation. At present, the Solana inflation rate works based on a fixed schedule. It begins at 8% annually and decreases 15% each year until it achieves 1.5% inflation. However, the proposed model would have reduced inflation by 80%.
Helius offered a detailed insight into the SIMD-228 model and its benefits. In addition to reducing inflation, the new model could also reduce unnecessary token issuance and improve network security. However, small validators would experience less profits, and the new model would increase complexity.
SIMD-228: A Historical Milestone for Crypto
The Solana voting system is garnering attention across the industry. Several community members appreciated the diligent voting process on the SIMD-228 proposal. Multicoin Capital co-founder Tushar Jain referred to it as a historical milestone for crypto.
Tushar even said that it is a major victory for the Solana ecosystem and its governance despite the proposal facing rejection. He further said,
“If this vote tells us one thing, it’s that the state of the Solana network is strong. This was a meaningful scaling stress test – a social, rather than technical, stress test – and the network passed despite a wide stratification of diverging opinions and interests.”
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