- Solana’s rejection of SIMD-0228 reflects a commitment to maintaining decentralization and market stability.
- Despite the failed proposal, SOL’s price surged 9%, indicating positive market sentiment toward Solana’s governance structure.
The Solana community recently faced a pivotal moment with the proposal of Solana Improvement Document 0228 (SIMD-0228), which aimed to transition the network’s fixed inflation schedule to a dynamic model. However, as CNF previously reported, Solana’s governance proposal SIMD-0228 to reduce inflation failed, receiving only 43.6% approvalinstead of the required 66.67%.
This shift would have adjusted the issuance of new SOL tokens based on the percentage of the total supply staked, potentially impacting validator incentives and the overall tokenomics of the network. Solana co-founder Anatoly Yakovenko spoke out through his tweet,
Solana governance needs to be fast and decisive. I pushed for 228 really hard and it failed. It failed decisively and fast. Which means that resources can now be spent on a better approach. How fast the ecosystem iterates is a thousand times more important than making sure that every proposal passes.
Community Response and Concerns
The proposal sparked extensive debate within the community. Concerns were raised about potential centralization, as smaller validators feared they might be disadvantaged under the new model. Additionally, some community members worried about the complexity and potential unintended consequences of implementing such a dynamic system.
The voting process for SIMD-0228 witnessed unprecedented engagement, with over 74% of validators participating — a testament to the community’s dedication to the network’s future. Ultimately, the proposal was rejected, reflecting the community’s cautious approach to altering foundational economic structures.
Cofounder’s Perspective on Governance
Yakovenko emphasized the importance of swift and decisive governance. He highlighted that the rapid resolution of such proposals allows the community to allocate resources more effectively, focusing on refining and improving future initiatives. Yakovenko stated,
How fast the ecosystem iterates is a thousand times more important than making sure that every proposal passes.
Market Reaction and SOL Price Movement
Interestingly, the rejection of SIMD-0228 coincided with a 9% surge in SOL’s price, bringing it back above the $130mark. This uptick suggests that investors viewed the decision as a commitment to maintaining stability and decentralization within the network.
As of now, Solana’s price stands at $128.43, reflecting a 4.69% decline in the last 24 hours and a 1.26% increase in the past week. See SOL price chart below.
Crypto News Flash – Read More