Solana validators have approved proposal SGP-0002 (also known as Double Disinflation) to double the network’s annual disinflation rate from 15% to 30%. The proposal secured 67% of votes in favor with 60.7% of total stake participating; 25.16% voted against, and 7.84% abstained.
As a result, Solana is expected to reach its terminal inflation rate of 1.5% in approximately 2.8 years, rather than taking nearly 6 years under the previous schedule. Total issuance will be cut by 18.9 million SOL over the next 6 years.
The proposal comes amid surging activity on Solana. Data from The Kobeissi Letter shows the network processed a record 4.2 billion transactions in July, up 13.5% from the previous month and 91% compared to December. Transaction volume jumped by more than 2 billion in just a few months.
The inflation reduction holds significant implications for SOL’s scarcity narrative. With a large share of transactions and applications running on Solana—ranging from DeFi to tokenized real-world assets (RWAs)—reducing newly issued supply reinforces the token’s intrinsic value over time. At the same time, this demonstrates the effectiveness of Solana’s governance mechanism: validators agreed to sacrifice short-term rewards in exchange for a less inflationary network in the long run.
This move also unfolds amid a broader debate over the economic models of Layer 1 blockchains. While some chains continue to issue substantial amounts of tokens to fund security, Solana is moving in the opposite direction: relying on real transaction activity rather than new issuance. An open question remains whether actual fee revenue will be sufficient to sustain security as issuance drops sharply—an answer that will become clear over the next few years as the network approaches the 1.5% inflation mark.