The price of Solana plummets, but the network continues to operate at full capacity. This strange antithesis of the crypto market reveals a paradoxical reality for investors. Developers are working hard to rethink the economics of SOL, while traders are massively shunning the token. A historic vote opens today to decide the future of the network. Burning ten times more SOL and reducing inflation by half are the main issues of this consultation. But small validators are trembling for their survival in the face of these radical changes.
In brief
- Solana votes on SGP-0003 to increase SOL burning tenfold, from 650 to 7,500-9,000 SOL per day.
- Proposed SIMD-0550 doubles the annual disinflation rate from 15 to 30 percent, bringing terminal inflation from 2032 to 2029.
- Small Solana validators fear “immediate extinction” and could vote against reducing SOL emissions.
- SOL price is trading at $74, far from its ATH, and markets are predicting a 70% chance of a drop to $40.
Burn ten times more SOL: Solana’s crazy bet
The SGP-0003 proposal is not simple, it aims to radically transform the economy of Solana. This text combines two major improvements, SIMD-0550 and SIMD-0553, to tighten the supply of SOL on the markets. SIMD-0553 introduces resource-based charges, all of which are permanently burned.
Concretely, daily burning would increase from 650 SOL to 7,500 or 9,000 SOL, a tenfold increase. SIMD-0550 doubles the annual disinflation rate from 15% to 30%, which would allow terminal inflation to reach 1.5% in 2029, three years earlier than expected.
“ Reducing emissions helps everyone who holds SOL in the long term », says lostinthe author of SIMD-0550. Helius, Jupiter, Drift and Solana Compass are among the strong supports. The threshold of 15% of the stake has already been crossed with 65.22 million SOL.
Small validators against giants: the staking war in crypto
Behind the enthusiasm displayed by the giants of the crypto ecosystem, a silent battle opposes Solana stakers. lostin he himself acknowledges that small validators could vote against the proposal, because reducing emissions would hit their already fragile incomes hard. Some propose introducing a minimum commission of 2 or 5% to protect the most modest.
A bitter memory lingers: SIMD-0228 was rejected by 38.61% due to similar concerns. Helius alone accounts for nearly two-thirds of current support, a concentration that questions the balance of power in the network. Small validators fear “immediate extinction” if the overhaul is adopted without a safety net.
The fate of this proposal rests on a precarious balance between the interests of the big players and the survival of the smaller ones. This antithesis could well decide the economic future of Solana.
SIMD-0553: Every complex transaction will burn SOL
The technical heart of this crypto overhaul relies on an ingenious burning mechanism designed by cavemanloverboy. 0.1 lamport, or one billionth of SOL, is burned per unit of cost requested, meaning that the more complex the transaction, the more SOL it consumes.
Non-computationally intensive operations, such as market maker updates, will be spared to preserve Solana’s competitive advantage in high-frequency trading.
“ We do not want to destroy Solana’s competitive advantage for high-frequency trading », assures cavemanloverboy, who has already orchestrated a test at 100,000 TPS on the network. Future technical improvements, such as Alpenglow, could speed up burning.
Yet Solana is still issuing 60,000 SOL per day, and even with 9,000 SOL burned, the blockchain will not become deflationary.
Key figures from the historic vote
- SOL price at time of writing: $74.03
- Current burns: ~650 SOL/day
- Projected burns: 7,500-9,000 SOL/day
- Terminal inflation: 2029 (vs. 2032)
- Support threshold: 65.22 M SOL
SOL price plummets as its tokenomics spirals out of control
SOL is trading around $74, far from its all-time high of $293, a dizzying gap in the crypto universe. Predictive markets are particularly pessimistic: 70% of traders are betting on a fall to $40 before any lasting rebound.
The Chaikin Money Flow is negative at -0.17, a sign that capital is leaving the Solana ship. The moving averages are all bearish, with major resistance at $76.79.
Liquidations are concentrated near $71.50 below and 73.50-74.50 above. The market seems to ignore the promises of improved tokenomics, preferring to focus on current weakness crypto.
The SOL rebounds. But spot demand is flat. Sign of weakness.
Ted Pillows
Are investors right to be so pessimistic, or is the SGP-0003 proposal largely underestimated by the crypto community?
Solana impresses the crypto-sphere, even without matching Ethereum in every way. Europe is already conquered, the rest of the world will probably follow. This tokenomic overhaul could accelerate the expansion of the Solana network. The ambition is global, and it seems within reach.
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