- Solana has reclaimed the $130 price mark after 74% of staked SOL participated in its recent on-chain voting.
- The increase in Solana’s price comes after the SIMD-228 proposal was rejected.
- This proposal sought to change SOL’s issuance from a fixed inflation rate to a more dynamic model by modifying staking rewards.
On Friday, Solana (SOL) saw a 9% increase following the results of the recent governance vote on SIMD 0228, which did not achieve the necessary 66.67% approval rate from participants.
Solana validators reject SIMD-228, leading to a slight price recovery for SOL
SIMD-228 did not gain the support needed for implementation, requiring 66.67% of votes to be in favor. The voting concluded with 27.6% of validators opposing the proposal and 43.6% supporting it, according to analytics from Dune.
A total of 74% of Solana’s staked supply participated in the vote, marking a significant moment in the network’s governance history with 910 validators involved.
Status of SIMD-228 voting. Source: Dune analytics
“In context, SIMD-228 represents the largest governance vote in the cryptocurrency space—both in terms of participant numbers and the overall market cap involved,” stated Tushar Jain, co-founder of Multicoin Capital.
The voting demographics included both large and small validators, as well as stakers from various segments of the Solana ecosystem. Notably, those with larger stakes tended to support the proposal, while those holding 500,000 SOL or less voted against it.
Introduced by Multicoin Capital, SIMD-228 was a governance initiative aimed at shifting Solana’s inflation structure from a fixed schedule to a more flexible, market-sensitive emission system. Currently, Solana’s inflation rate is approximately 4.7% annually, with a pre-determined reduction of 15% until it stabilizes at a terminal rate of 1.5%.
The SIMD-228 proposal suggests changing the annual inflation rate from 4.7% to an adjustable emission rate based on the volume of SOL being staked.
This proposal sparked intense discussions within the Solana community. Proponents argued that a flexible model would mitigate inflation, stabilize SOL’s price, and encourage its adoption in decentralized finance (DeFi) ecosystems.
Conversely, critics claimed that lowering staking rewards could jeopardize decentralization by incentivizing smaller validators to go offline. They also warned that decreasing inflation for a well-established network like Solana could impede its long-term growth.
At the time of writing, SOL is trading around $134, having gained 9% over the past 24 hours.