The post Solana Plans Its Biggest Economic Shift In History appeared on BitcoinEthereumNews.com. Solana is weighing a radical shift in its economic model that would eliminate approximately 22.3 million SOL ($2.9 billion) from projected emissions over the next six years. As a result, the proposal would aggressively fast-track the transition of the blockchain to a low-inflation environment. Sponsored Sponsored Solana’s Plan to Tighten Supply Risks Squeezing Nearly 50 Validators The measure, formally titled SIMD-0411, proposes doubling the Solana network’s annual disinflation rate from 15% to 30%. “Doubling the disinflation rate requires modifying a single parameter, making it the simplest possible protocol change that delivers a meaningful reduction in inflation. This adjustment will not consume core developer resources. It carries minimal risk of introducing bugs or unforeseen edge cases,” the authors argued. If passed, Solana would hit its “terminal” inflation target of 1.5% in roughly three years, ie, by 2029. Notably, that milestone was originally scheduled for 2032. Proponents describe the current emissions schedule as a “leaky bucket” that continually dilutes holders and creates persistent sell pressure. By tightening supply, the network hopes to emulate the scarcity mechanics that have historically benefited Bitcoin and Ethereum. “Our modeling indicates that, over the next 6 years, total supply would be approximately 3.2% lower (a reduction of 22.3 million SOL) than under the current inflation schedule. At today’s SOL price, this equates to roughly $2.9 billion in reduced emissions. Excessive emissions create persistent downward price pressure, distorting market signals and hindering fair price comparison,” they wrote. Solana’s Disinflation Proposal. Source: Solana Floor Sponsored Sponsored Beyond price support, the plan seeks to overhaul the incentive structure for decentralized finance (DeFi). Moreover, the proposal argues that high inflation mirrors high interest rates in traditional finance, raising the “risk-free” benchmark and discouraging borrowing. Considering this, Solana aims to push capital out of passive validation and into active liquidity provision by… The post Solana Plans Its Biggest Economic Shift In History appeared on BitcoinEthereumNews.com. Solana is weighing a radical shift in its economic model that would eliminate approximately 22.3 million SOL ($2.9 billion) from projected emissions over the next six years. As a result, the proposal would aggressively fast-track the transition of the blockchain to a low-inflation environment. Sponsored Sponsored Solana’s Plan to Tighten Supply Risks Squeezing Nearly 50 Validators The measure, formally titled SIMD-0411, proposes doubling the Solana network’s annual disinflation rate from 15% to 30%. “Doubling the disinflation rate requires modifying a single parameter, making it the simplest possible protocol change that delivers a meaningful reduction in inflation. This adjustment will not consume core developer resources. It carries minimal risk of introducing bugs or unforeseen edge cases,” the authors argued. If passed, Solana would hit its “terminal” inflation target of 1.5% in roughly three years, ie, by 2029. Notably, that milestone was originally scheduled for 2032. Proponents describe the current emissions schedule as a “leaky bucket” that continually dilutes holders and creates persistent sell pressure. By tightening supply, the network hopes to emulate the scarcity mechanics that have historically benefited Bitcoin and Ethereum. “Our modeling indicates that, over the next 6 years, total supply would be approximately 3.2% lower (a reduction of 22.3 million SOL) than under the current inflation schedule. At today’s SOL price, this equates to roughly $2.9 billion in reduced emissions. Excessive emissions create persistent downward price pressure, distorting market signals and hindering fair price comparison,” they wrote. Solana’s Disinflation Proposal. Source: Solana Floor Sponsored Sponsored Beyond price support, the plan seeks to overhaul the incentive structure for decentralized finance (DeFi). Moreover, the proposal argues that high inflation mirrors high interest rates in traditional finance, raising the “risk-free” benchmark and discouraging borrowing. Considering this, Solana aims to push capital out of passive validation and into active liquidity provision by…