Lily Liu, president of the Solana Foundation, has expressed concerns over Multicoin Capital’s SIMD-0228 proposal, which aims to shift Solana’s emissions mechanism to a market-based model. Liu warns that unpredictable staking rewards could deter institutional investors, citing past experiences with ATOM. Proponents argue that reducing emissions could enhance institutional adoption, particularly for SOL ETFs awaiting SEC approval. The vote on SIMD-0228 is scheduled for March 6.
about Solana Foundation President Warns Against Proposal SIMD-0228's Impact on InstitutionsAnza
0 in Finance and 0 in Crypto last weekSolana proposal aims to cut inflation by 80 amid decentralization concerns
The Solana community is set to vote on proposal SIMD-0228, which aims to reduce annual inflation by up to 80% through dynamic “smart emissions” based on staking participation. While some, including co-founder Anatoly Yakovenko, support the change for long-term sustainability, critics warn it may centralize the network by disadvantaging smaller validators. Concerns have been raised about potential declines in validator earnings, which could threaten decentralization and favor larger institutional players.
about Solana proposal aims to cut inflation by 80 amid decentralization concernsSolana Proposal Aims to Reduce Inflation by 80 Percent Through New Model
Solana’s community is considering a governance proposal, SIMD-0228, that could reduce inflation by up to 80% by adjusting token issuance based on staking activity. Currently, with 65% of tokens staked, the proposal aims to enhance economic sustainability while addressing concerns about excessive token emissions and potential impacts on smaller validators. Voting on this pivotal proposal is set for March 6, 2025, requiring a two-thirds majority to pass.
about Solana Proposal Aims to Reduce Inflation by 80 Percent Through New Model