Solana Proposal Could Reduce Staking Yield to 2.25%, Cutting SOL Issuance by $1.5 Billion Over 6 Years

Odaily News: Two Solana proposals aim to reduce token issuance and increase burning, expected to cut SOL issuance by $1.4 billion to $1.5 billion over 6 years. SIMD-550 has entered the governance voting stage, proposing to increase the annual inflation rate reduction from 15% to 30%; SIMD-553, approved in July, will increase the burn amount based on requested compute units.

Research from crypto asset investment firm 21Shares shows that the current Solana staking yield is approximately 5.25%. If SIMD-550 passes, the nominal staking yield is expected to drop to roughly 4.34% in the first year, 3% in the second year, and 2.25% in the third year, reaching a terminal inflation rate of 1.5% by the first half of 2029.

After SIMD-553 is implemented, Solana's daily SOL burn is expected to rise from approximately 600 to 800 SOL to between 7,500 and 9,000 SOL. Currently, about 67.9% of SOL is staked; under the impact of fee structure changes and declining inflation, it is estimated that 2 validators may incur losses in the first year, increasing to approximately 30 by the third year. (Bitcoin.com News)