80% Inflation-Cutting Proposal Fails to Pass Vote Threshold on Solana

In a remarkable showcase of on-chain governance, a proposal aimed at cutting Solana's inflation rate by 80%—identified as SIMD-228—has officially failed to meet the vote threshold required for passage.

In a noteworthy development within on-chain governance, a proposal to cut Solana’s inflation rate by 80%—designated as SIMD-228—has failed to achieve the vote threshold required for passage.

In a noteworthy development within on-chain governance, a proposal to cut Solana’s inflation rate by 80%—designated as SIMD-228—has failed to achieve the vote threshold required for passage.

The motion, which witnessed an astounding turnout across the Solana ecosystem, was ultimately rejected as smaller validators tipped the balance with “No” votes, pushing the approval percentage below the 66.67% threshold.

Solana Inflation Remains High

Voting on SIMD-228 took place alongside SIMD-123, both of which concluded with levels of participation never before seen in the Solana ecosystem. According to Laine, a prominent Solana validator, 74.3% of all eligible stake participated in SIMD-228, while 57.1% joined in on SIMD-123.

While a majority voted “Yes” on 228, with 61.39% of voters opting for the proposal, it fell short of the required supermajority. In contrast, 123 met its threshold and passed with 74.91% approval.

“This has been a massive milestone in Solana governance with absolutely earth-shattering participation and contentious debate,” said Laine via X. “It is incredible to see this level of investment by so many stakeholders, no matter the outcome one can only be hopeful for our future as an ecosystem!”

The official Solana account highlighted the magnitude of the vote by stating: “Solana SIMD 228 voter turnout was higher than every US presidential election in the last 100 years.”

Such a comparison showcases how deeply this proposal resonated with the network’s broad constituency. Community members, validators, investors, and developers engaged in discussion around the proposal’s potential impacts on inflation, staking rewards, and the overall health of the chain.

A schism in voting results was evident, largely attributed to differing validator incentives and profitability concerns. Ben Sparang, formerly of the Solana Foundation, offered insight: “The breakdowns of SIMD-228 votes by stake level tell a decisive story. Large validators are overwhelmingly in favor as they don’t have to worry about their margin of profitability. Small validators are overwhelmingly against as they might not be in business under the new regime.”

Among smaller operators, fears arose over reduced staking rewards if the inflation rate fell sharply. Many argued that diminished yields would escalate their infrastructure costs and could ultimately force them off the network.

Larger validators, who primarily generate income from transaction fees and leader slots, largely supported the proposal. They argued that a lower inflation rate would be beneficial for boosting SOL’s long-term value.

As reported by Prime (founder of X1,), smaller validators expressed concerns over the significant decrease in future token issuance that would result from cutting inflation.

“The proposal is to reduce SOL inflation, which is a good idea as it reduces at least $4B in SOL issuance per , stops dilution the supply and reduces sell pressure,” said Prime. “The problem is a lot of smaller validators will be forced to leave the network as their staking rewards likely going to be cut, making it too expensive to run their nodes.”

Tushar Jain, co-founder and Managing Partner at Multicoin Capital, remarked on the record-breaking turnout, adding that it was a noteworthy milestone for decentralized governance.

“It was the biggest crypto governance vote ever—both in terms of the number of participants and the participating market cap of any ecosystem, chain, coded network—nearly $250B in crypto value voted on this one small piece of code. 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.”

Jain noted how the turnout—over 74% of stake among 910 individual validators—highlighted Solana’s vitality and institutional adoption. While the “Yes” votes on 228 ultimately fell short, he remarked on the importance of the discussion that unfolded over several months. He also promised to incorporate community feedback for future proposals.