Solana’s Best Month Since 2024 Ends With a Historic Supply-Squeeze Vote
Solana is closing out its strongest month in nearly two years, and the rally is landing at a uniquely symbolic moment: the same day the network’s validators finish the first binding governance vote in its history, deciding whether to print less SOL and burn far more of it every day.
SOL has climbed more than 8% in the past 24 hours and is up roughly 44% since the beginning of August, its best monthly performance since 2024, pushing the token back above the 105 USD mark for the first time since January. The surge has arrived alongside a wave of speculation that traders have spent the week pricing in a potential supply squeeze ahead of the vote’s outcome.
What is being voted on
Voting wraps up at the end of epoch 1023, roughly a two-to-three-day stretch of network activity that Solana uses as its internal clock. The vote bundles three proposals under Solana Governance Proposals, or SGPs, a brand-new on-chain system that allows validators and the people who delegate SOL to them to cast binding, stake-weighted votes for the first time ever.
One of the three ratifies a Solana Constitution, formalizing how on-chain voting will work going forward. The other two proposals, SIMD-550 and SIMD-553, are the ones moving the price conversation.
SIMD-550, filed by engineers at Solana infrastructure firm Helius, would double the network’s disinflation rate, the yearly pace at which new-token issuance shrinks, from 15% to 30%. Solana’s inflation already declines each year on its way to a fixed 1.5% floor. The proposal simply gets there faster, reaching that floor by 2029 instead of 2032, which works out to roughly 18.9 million fewer SOL created over the next six years.
The trade-off is real. Issuance is what pays stakers, the people who lock up SOL to help secure the network, their yield. According to an analysis from 21Shares, cutting issuance that hard would push staking yield down from around 5.25% today to roughly 2.25% within three years. Observers have compared the change to a Bitcoin halving for staking. But a few smaller validators could become unprofitable in the process, so the shift is not unambiguously good news for every participant in the ecosystem.
The burn proposal
SIMD-553, submitted by Solana research and development firm Temporal, attacks the supply question from the other direction: burning. The proposal splits Solana’s transaction fee into two pieces, a base inclusion fee that still pays the validator and a new resource fee, tied to how much computing power a transaction consumes, that would be destroyed outright.
That single change would take Solana’s daily burn from roughly 650 SOL, worth about 48,000 USD, to as much as 9,000 SOL, worth around 668,000 USD, a jump of roughly 12 to 14 times depending on network activity. The proposal already cleared code review from Solana’s two client teams, Anza and Firedancer, back on July 20. The vote decides whether it turns on, not whether it is technically ready.
Not everyone in the ecosystem is voting yes on both. Nasdaq-listed treasury firm Solana Company, which trades under the ticker HSDT, is backing the new constitution but voting against both tokenomics changes. Management says the objection is about timing rather than substance: predictable staking yield matters more to institutional stakers right now than a faster reduction in issuance does.
Both proposals require a two-thirds supermajority of participating stake, and they are being voted on independently, so a rejection of one would not sink the other. Results are expected within hours of epoch 1023 closing.
Momentum running hot
Regardless of the outcome, the chart has not slowed down. SOL’s 14-day relative strength index, a momentum gauge where readings above 70 typically flag an asset as overbought, was sitting near 84.5 heading into the vote, a level that suggests the rally has been unusually one-sided.
The month-long surge has also restored Solana to the center of the altcoin conversation after a difficult first half of the year. A roughly 44% monthly gain, combined with a governance process that gives holders direct, binding influence over monetary policy for the first time, has drawn comparisons to the community-driven supply debates that have historically defined Bitcoin.
The stakes are straightforward. If both measures pass, Solana’s tokenomics tighten dramatically by the end of the decade, with less new supply entering the market and a substantially larger share of everyday fees leaving circulation forever. If they fail, the network keeps its current issuance schedule, and the rally will need to find its fuel somewhere other than a supply squeeze.
Either way, the vote itself marks a milestone: the first time a protocol change of this magnitude on Solana has been decided by the token’s holders directly, rather than by developers or foundations. That governance experiment, as much as the price action, is what makes the current moment historic for the network.
Disclaimer: This article is for informational purposes only and does not constitute financial advice.
first binding vote in solana history and its about burning more SOL. validator incentives finally aligning with holders, about time
everyone screaming squeeze, nobody asking what epoch 1023 turnout looks like. if delegates dont show up this vote means nothing
turnout worried me too until i remembered its stake-weighted. passive delegation votes with the validator unless you split
turnout mostly answers itself, its stake weighted so validators vote with defaults. the real test is whether the constitution clause holds up in an actual contentious fork
the constitution clause is the part validators actually read. the 553 priority fee burn is nice but binding precedent for a contentious fork is what treasuries were waiting on
44% in a month and people call this a supply squeeze setup. Might just be a normal bull month with extra steps.
@greta 105 was resistance since january, breaking that on vote day is not nothing
SIMD-553 quietly rerouting priority fees to the burn gets zero airtime while everyone fights about 550. the burn side is the actual daily supply change
SIMD-553 point is underrated. priority fees are basically all the real activity anyway, rerouting those to burn does more daily than the headline inflation cut ppl keep arguing over
Agreed. Priority fees are the honest measure of demand, base fees have been noise since the fee market change.
staking a constitution into the chain itself is genuinely cool tech even if the price action is doing all the talking
44% in a month and people still call sol a VC chain lol. SIMD-550 doubling disinflation to 30% is the real story here
the vote is stake-weighted so big validators decide anyway. retail delegates barely move the needle
disinflation doubling doesnt mean less SOL right away, issuance still grows just slower. ppl keep getting this wrong
correct, issuance still grows, but the 1.5% floor just arrives faster. slow squeeze still counts imo
right, doubling disinflation just compresses the calendar to the 1.5 percent floor. its a speed change not a supply flip, ppl keep conflating them
ending the best month since 2024 with the first binding governance vote in history is kinda poetic ngl
SIMD-553 burn side getting way less airtime than 550 but thats the one changing daily supply. everyone fixated on issuance
44 percent in a month and the vote hasnt even closed yet. if epoch 1023 ratifies all three SGPs this thing gets interesting fast, half the move feels like people fronting the burn
if all three clauses ratify at epoch 1023 the squeeze part takes care of itself. supply locked plus priority fee burn is a nasty combo for shorts
and SIMD-553 burns priority fees daily on top of the doubled disinflation. if all three ratify, shorts are fighting arithmetic at that point
arithmetic only wins if usage holds. the priority fee burn scales with activity, one quiet quarter after epoch 1023 and the squeeze math flattens right out
first binding vote in solana history ratifies an actual constitution and the market prices it as a squeeze setup. the governance rail is the bigger story long term
agreed on the governance rail being the real story. first binding vote plus a constitution sets up Solana for treasury decisions later, people are too focused on one epoch of fees
best month since 2024 and my timeline is still full of sol is dead posts from march. the vote timing couldnt be better PR
105 breaking on the same day epoch 1023 wraps up. someone planned the optics on this one perfectly ngl
sol up 44 percent in a month and the discourse is still issuance math. SIMD-553 burning priority fees changes daily supply more than 550 and it gets a tenth of the tweets