Written by: Xiao Bing

This is the first full network governance vote in Solana's history, and the outcome resembled an election night.

With 70 minutes left until the voting deadline, the support rate for SGP-0002 (Double Disinflation) was below the passing line, with the opposition leading by about 58 million SOL. The validator "Kraken 2," associated with Kraken, had switched from support to opposition a few hours earlier, directly pulling the approval rate below the two-thirds threshold. Helius CEO Mert Mumtaz began making frantic calls, stating on X that he made about 500 calls in the last few hours.

Then, Kraken flipped back.

Galaxy Digital also shifted from abstaining to support. Holders of JitoSOL circumvented the validators voting against by using the "staker covering" mechanism to directly vote in favor with their own staking weight.

At the end of epoch 1024, SGP-0002 passed with a support rate of 67.001%, just exceeding the passing line of 66.667% by 0.334 percentage points. Approximately 176 million SOL voted in favor, about 66.19 million opposed, and around 20.63 million abstained. 1326 validators participated, accounting for 60.7% of eligible stakes.

This was the first real-world test of Solana's new chain governance system (launched in July this year). A network valued at over $60 billion had its monetary policy turned around at the last minute by a validator from an exchange.

What did the vote change?

The content of SGP-0002 itself is not complicated.

The current inflation rate for Solana decreases at a rate of 15% per year. This proposal doubles the rate of decrease to 30%, bringing the terminal inflation rate of 1.5% to reach about three years earlier, expected around 2029 instead of the original 2032.

The specific impact is that, over the next six years, the Solana network will issue approximately 18.9 million fewer SOL than originally planned, roughly equivalent to 2.6% of the current supply. At current prices, this "unissued" SOL is worth around $2 billion.

This does not represent an immediate supply shock. The inflation rate will not be halved overnight but rather decline at a faster rate each year. Estimates from 21Shares indicate that staking yields could drop from about 5.25% to around 2.25% within three years. This poses a tangible economic pressure for smaller validators reliant on staking yields.

The logic of the opponents is not absurd.

Everstake (which voted against with about 7.96 million SOL) holds the position that they are not against reducing inflation overall but question the speed of the change and its disproportionate impact on smaller validators. Figment was the largest opponent, voting against with approximately 17.07 million SOL.

The context of the proposal is also noteworthy. In March 2025, a similar proposal, SIMD-0228, failed to reach the two-thirds threshold with about 61% support. Smaller validators collectively mobilized late in the voting to block the proposal. SIMD-0411 faced the same fate at the end of 2025 and the beginning of 2026.

SGP-0002 is the third attempt, employing a more conservative design (a fixed rate of decrease rather than a dynamic inflation model), and it narrowly passed.

Kraken's 8.9 million SOL

What turned this vote from a "policy debate" into a "political thriller" were the maneuvers in the final hours.

"Kraken 2" is a validator associated with the exchange Kraken, holding about 8.9 million SOL in stakes, accounting for about 2% of the total voting power. This validator initially voted in favor but switched to oppose a few hours before the deadline, directly pulling the support rate below 66.67%.

Protos conducted a counterfactual calculation: had Kraken's vote remained opposed, the final support rate for SGP-0002 would have been about 63.9%, far below the passing line. The vote change of one validator determined the token issuance curve for the entire network over the next six years.

Kraken co-CEO Arjun Sethi wrote a poignant statement in response: "Custodians should be conduits, not voices."

Solana's governance framework (SGP-0001) designed the "staker sovereignty" mechanism for this purpose: users who delegate their stake can override the votes of validators and independently express their stance using their staking weight. JitoSOL holders exercised this right in the final stages, with analyst Brian Smith pointing out on X that without the JitoSOL holders overriding the position of validators, SGP-0002 would have similarly failed.

The existence of this mechanism proves the foresight of Solana's governance design. However, it was first used on a large scale in a scenario that required "overriding the will of validators" to pass the proposal, a fact that warrants reflection.

One passed, one failed

Three proposals were voted on simultaneously. SGP-0001 (Solana Constitution) passed easily with 85.97% support, establishing the rule framework for future governance, including the proposal process, voting weights, and passing thresholds. A minimum stake of 100,000 SOL is required to submit a proposal.

SGP-0003 (Resource and Inclusion Fee) did not pass, with a support rate of only 53.9%, falling nearly 13 percentage points short of the two-thirds threshold. This proposal aimed to split Solana's current fixed signature fee into two parts: a fixed inclusion fee of 2500 lamports (paid to the block producer), plus a fee calculated based on computational resources (100% burned). If passed, it could burn up to 9,000 SOL daily.

The failure of SGP-0003 is also significant.

It means the Solana community is willing to accept "issuing fewer SOL" (supply-side reform), but is not yet ready for major changes to the fee structure (revenue-side reform). The economic interests of validators diverged on the two proposals: reducing inflation benefits large validators holding substantial amounts of SOL, but changing fee distribution directly impacts block production revenue.

Helius simultaneously drafted the underlying technical proposals for SGP-0002 and SGP-0003 (SIMD-0550 and SIMD-0553), with the two proposals coming in and out, while Mumtaz publicly requested help from Solana co-founder Anatoly Yakovenko to mobilize the remaining validators in pushing SGP-0003, but ultimately failed to gather enough votes.

Passing a vote does not equal implementation

SGP-0002 is currently a governance mandate, not an automatically executed protocol change.

Technical implementation needs to go through a separate development process via SIMD-0550: the client team must write code to include a feature gate called double_disinflation_rate, which validators must activate on the mainnet. As of the time of publication, SIMD-0550 remains in "Review" status in the documentation repository of the Solana Foundation.

There is still considerable distance between authorization and launch.

If the client implementation goes smoothly and all parties reach consensus on arithmetic logic, and the feature gate is activated without dispute, SGP-0002 will mark Solana's significant step toward proactive monetary policy management. However, if the implementation process encounters obstacles or reignites controversy, this 0.334 percentage point passing result will be hard to see as true consensus.

Solana Company (the entity renamed from Solana Labs) voted against both SGP-0002 and SGP-0003 in this vote. This detail is often overlooked. The core development company of the network opposed the governance proposals, yet the proposals still passed, which is uncommon in blockchain governance history, sending a positive signal for decentralization.

But the issues exposed during the voting process are equally real: the ownership of voting rights by exchanges holding staked assets is ambiguous, the last-minute vote changes by large validators can determine outcomes, and the concentrated phone lobbying by proposal advocates mirrors whip operations in traditional politics.

Solana has just completed the most serious on-chain monetary policy democratic experiment in the crypto field, and the results show that democracy is always messier and more vibrant than one might imagine.