SGP-0002 Passes: Solana's Disinflation Vote Decided by 0.334 Points After Kraken Reversal

Seventy minutes before Solana SOL$114.83-3.3% Solana's first binding governance vote closed, SGP-0002 was failing by 58 million SOL SOL. Kraken Kraken had switched its 8.9 million SOL from support to opposition hours earlier, dragging approval below the required two-thirds threshold. What followed was a validator lobbying sprint unlike anything Solana governance had seen before. When epoch 1024 sealed, SGP-0002 cleared the 66.667% bar with exactly 0.334 percentage points to spare.

SGP-0002 Final Vote: 67.001% With 176 Million SOL in Favor

The tally, as reported by Decrypt and The Defiant: 176.29 million SOL voted for and 66.19 million against, with 20.63 million abstaining. Of the 433.49 million SOL eligible under the snapshot, 60.7% participated across 1,326 validators, the highest on-chain governance participation in Solana's history.

The proposal doubles Solana's annual disinflation rate from 15% to 30%, reducing projected SOL issuance by roughly 18.9 million tokens over six years, per The Defiant. At current prices, The Defiant estimates that reduction at approximately $2 billion. The network now targets a 1.5% terminal inflation floor by the first half of 2029, three years ahead of the 2032 timeline the current rate implied. Staking yields compress alongside supply growth: The Defiant's projections show year-three yields falling to approximately 2.25%, against the current trajectory of roughly 5.25%.

Kraken's Three-Way Flip and Mert Mumtaz's 500 Validator Calls

Kraken's shift from YES to NO during the vote was the pivotal event that opened the crisis. Our earlier coverage at 12:33 UTC documented the exchange casting 8.9 million SOL against SGP-0002 with under three hours remaining, dropping approval below threshold. Galaxy also swung from near-full abstention to partial support in the final hour.

Kraken then reversed course, moving approximately 8.1 million SOL back to the FOR column in the final stretch, according to The Defiant. The exchange's co-CEO Arjun Sethi said only this after the vote: "Custodians should be conduits, not voices," as reported by Decrypt.

Helius hSOL$136.63-3.0% Helius CEO Mert Mumtaz spent those hours calling validators. He described the outcome on X:

Helius itself voted 16.05 million SOL at a 99.5% FOR rate, per The Defiant. The proposal was co-authored by Helius contributors Lostin and 0xIchigo.

Notable votes against included Figment at 17.07 million SOL and Everstake at 7.96 million SOL, per The Defiant. Jupiter JUP$0.377+14.5% Jupiter voted 11.78 million SOL in favor.

JitoSOL Staker Override Proved Decisive

Solana's governance design, established under SGP-0001, includes a staker override mechanism allowing liquid staking token holders to direct their stake votes separately from the validator managing that stake. In practice, Jito JTO$0.572+9.0% Jito's liquid staking token JitoSOL JitoSOL holders exercised this override in the closing hours.

Analyst Brian Smith posted on X that SGP-0002 would have failed without JitoSOL holders overriding their validators' positions. The Orb Markets vote tracker confirmed the final picture: "SGP-0002 passed by 0.334 percentage points. 67.001% for. The bar was 66.667%. With 70 minutes left it was losing by 58M SOL."

What Changes Next: SIMD-0550 Implementation and the SOL Inflation Rate Path

SGP-0002 is a governance mandate, not a protocol change that activates automatically. The underlying technical implementation is SIMD-0550, which still requires Solana client teams to ship and validators to activate on-chain.

From here, issuance begins declining at 30% per year once the network activates SIMD-0550, versus the current 15% annual reduction. That gap widens each epoch. By the time the 1.5% floor is reached in early 2029, the cumulative reduction in SOL supply versus the prior schedule will be approximately 18.9 million tokens.

Galaxy Research's pre-vote analysis noted the broader context: Solana's economy "aims to host the world's economy" rather than targeting protocol ossification, making the pace of issuance reduction a genuine economic tradeoff. Thirty validators are projected to become unprofitable within three years under the new schedule, per The Defiant.

SGP-0001 at 86%, SGP-0003 Fee Burn Falls at 53.9%

The vote bundle had three proposals. SGP-0001, the Solana Constitution that established the governance framework itself, passed at 86% with 193.65 million SOL in support and 4.63 million against, as reported by Decrypt.

SGP-0003, which would have replaced Solana's fixed 5,000-lamport-per-signature base fee with resource-priced inclusion fees and roughly 7,500 SOL burned daily, received 53.9%: 142.84 million SOL in favor against 50.15 million opposed and 72.03 million abstaining, per Decrypt. That is well above quorum but short of the two-thirds requirement.

The fee burn mechanism, backed by Galaxy Research's projections of a 14x increase in daily SOL destruction, did not carry consensus. An earlier announcement piece outlined the full scope of what all three proposals would change.