Solana’s first onchain governance vote has cleared its participation threshold across all three proposals, but the outcome remains uncertain for two measures targeting SOL’s supply. The proposal to accelerate disinflation is passing by a slim margin, while the plan to increase daily token burns has yet to reach the required two-thirds approval.
Validators and stakers are voting on two separate mechanisms for slowing SOL supply growth. One proposal would reduce the pace at which new tokens are issued, while the other would redirect a larger share of transaction fees toward permanently removing SOL from circulation.
Solana issues new SOL to reward the network participants responsible for maintaining and securing the blockchain. Reducing issuance or increasing burns would lower the rate of net supply expansion, potentially reducing dilution for existing holders.
The votes are particularly significant because they represent Solana’s first formal onchain governance process. Under the system, validators and stakers can directly vote on proposals that could alter the network’s economic model and technical operations.
One of the supply proposals would introduce a transaction-fee mechanism based on the computational resources consumed by each transaction. The associated fee portion would be burned, potentially increasing daily SOL destruction from about 650 tokens to as much as 7,500-9,000 SOL.
At current weekly prices, burning 9,000 SOL per day would amount to roughly $800,000. However, that figure remains far below the approximately 60,000 SOL the network currently generates each day, according to earlier CoinDesk reporting.
Solana Governance: What It Takes to Pass
For a proposal to qualify, at least one-third of the network’s total stake must participate. It then needs support from two-thirds of the participating stake to pass.
Abstentions count toward participation but do not add to the approval total. This means a proposal can meet quorum while still struggling to secure enough affirmative votes.
Solana’s governance data showed that all three proposals had surpassed the quorum requirement by Friday.
SGP-0001, SGP-0002 and SGP-0003 Explained
SGP-0001, described as Solana’s “constitution,” has received overwhelming backing. It establishes the framework for future governance votes, covering participation rules, voting weights and the conditions required for approval. Support stood at 95.35%, with just 0.22% voting against it.
SGP-0002 is much closer to the threshold. It proposes speeding up Solana’s disinflation schedule by reducing new SOL issuance at a 30% annual rate instead of the current 15% pace.
The proposal had 68.77% support and 47.72% participation. If approved, Solana’s annual issuance rate would reach its long-term floor of 1.5% around 2029 instead of 2032.
That accelerated schedule would result in approximately 18.9 million fewer SOL being created over six years.
SGP-0003 has the weakest position of the three. It seeks to change Solana’s transaction-fee structure and substantially increase the amount of SOL burned.
The proposal has 62.72% support, while 16.52% oppose it and 20.75% abstain. Participation stands at 42.51%, leaving it below the two-thirds approval requirement.
The high abstention rate makes the proposal’s path to passage more difficult. While abstentions help satisfy quorum, they effectively increase the amount of affirmative support required among participating stake.
HSDT Opposes the Supply Changes
The proposals aimed at changing SOL’s supply economics have also attracted public criticism. Solana Company, a Nasdaq-listed SOL treasury firm operating under the HSDT ticker, said on Aug. 21 that it supported SGP-0001 but opposed both SGP-0002 and SGP-0003.
The company argued that institutional investors require stable and predictable economic rules when planning investments and operations over several years.
The votes were initially expected to close around Thursday afternoon UTC, but remained open Friday as the final voting epoch continued. Solana governance periods last for three epochs, with their duration determined by blockchain activity rather than a fixed time schedule.
Even if SGP-0002 or SGP-0003 passes, the changes would not take effect immediately. A successful vote provides authorization to proceed, while the corresponding technical updates still need to be designed, developed and deployed separately.
