The Solana community is preparing to vote on SIMD-228, a proposal that could introduce a market-driven emissions model for SOL tokens.
Solana Community Debates Tokenomics Shift
The Solana community is debating Solana Improvement Document (SIMD)-0228, a governance proposal that will reshape the network’s tokenomics by introducing a dynamic, market-driven inflation model for SOL tokens. SIMD-228 is authored by Tushar Jain and Vishal Kankani of Multicoin Capital, with support from Max Resnick, lead economist at Anza, a key player in Solana's development ecosystem. It proposes a market-driven emissions model that adjusts the issuance of new SOL tokens (inflation rate) based on the percentage of the total SOL supply that is staked.Adjusting SOL Inflation Based on Staking
This proposal seeks to replace Solana's fixed inflation schedule — currently set at 4.6% annually, decreasing by 15% each year until stabilizing at 1.5% — with a system that adjusts emissions based on staking participation. If the percentage of staked SOL drops below the target 33% threshold, the emissions rate increases. With a high staking rate, rewards decrease, reflecting that the network doesn’t need to "overpay" for security, thus reducing inflation. However, the proposal may impact the profitability of stakers and validators, especially smaller ones.Potential Impact on SOL Holders
Meanwhile, proponents argue that Solana's growing economic activity justifies evolving its monetary policy, explaining that lower emissions during high staking could make SOL scarcer and more valuable, benefiting long-term holders. As such, it could drastically reduce inflation and prevent the annual value leakage of hundreds of millions of dollars. If the proposal is approved, estimates suggest that under the current 65% staking rate, the new inflation rate could drop below 1% annually. If staking participation post-implementation drops to the 33% threshold, the inflation rate will adjust upward to incentivize staking.Ecosystem Leaders Continue Debate
Solana’s leadership is still debating the proposal and has invited diverse opinions. Solana co-founder Anatoly Yakovenko appears to have given his support, as have other key figures in the ecosystem, such as Helius founder Mert Mumtaz. On the other hand, Solana Foundation president Lily Liu stood out as a cautious skeptic, urging a broader rethink of the proposed inflation model. The authors, Vishal Kankani and Max Resnick, have defended SIMD-0228, stating that the proposal has undergone nearly two months of discussion and incorporates various community inputs. The proposal is expected to undergo voting in epoch 753 and may begin over this weekend.
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