Solana Company has backed Solana’s proposed constitution while opposing two economic plans that could cut token issuance by 18.9 million SOL and raise daily token burns as voting opens on Aug. 22.
Summary
- Solana Company will support SGP-0001 and vote against SGP-0002 and SGP-0003.
- SGP-0002 could reduce projected SOL emissions by 18.9 million tokens over six years.
- The Nasdaq-listed company said changing staking and fee rules could discourage institutions.
- Successful governance votes would guide policy but would not automatically activate either proposal.
The company said in an Aug. 21 press release that it will vote for SGP-0001, known as the Solana Constitution, while opposing SGP-0002, the Double Disinflation Rate proposal, and SGP-0003, the Resource and Inclusion Fee proposal.
On-chain voting for the first three Solana Governance Proposals is expected to begin on Aug. 22. Solana Company, which trades on Nasdaq under the HSDT ticker, operates institutional validator infrastructure across the Asia-Pacific region and earns staking revenue from its SOL treasury.
Its support for SGP-0001 rests on the proposed constitution’s voting structure. Under the system, staking participants receive transparent votes weighted by their stake, while token holders retain the power to override votes cast by the operators managing their delegated SOL.
According to the company, the structure gives financial institutions a direct way to participate in decisions affecting the network without surrendering control of their voting rights to validators. Management said adopting the constitution would establish the governance system needed to bring more institutional participants into Solana.
Solana Company opposes changing two economic rules
While supporting the governance framework, Solana Company said the first voting cycle should not be used to change Solana’s issuance schedule and transaction fee model at the same time.
Management described the goals behind SGP-0002 and SGP-0003 as reasonable. However, the company said institutions considering validator operations or staking need economic rules they can model across several years.
In conversations with financial institutions, Solana Company said issuance itself has rarely been raised as a barrier. Questions have instead focused on whether Solana’s economic rules will remain reliable long enough for institutions to forecast revenue, costs and cash flow.
Changing two of the network’s most stable economic parameters during the first live governance cycle could delay decisions by firms already assessing Solana, according to the release. The company therefore framed both opposing votes as objections to timing rather than to the proposals’ underlying goals.
“We strongly believe that institutional adoption is a critical driver of Solana’s growth, and institutions make decisions based on consistent, predictable structures,” Solana Company Chairman and CEO Joseph Chee said.
Chee added that the disclosed positions were intended to support institutional participation and said the company plans to work with other industry participants as Solana’s governance system develops.
SGP-0002 would accelerate SOL disinflation
SGP-0002 asks Solana voters whether the network should proceed with a faster reduction in token issuance. The related technical plan, SIMD-0550, would double the annual disinflation rate from 15% to 30% while retaining Solana’s terminal inflation rate of 1.5%.
Proposal estimates indicate that the faster schedule would reach the 1.5% floor in about 2.8 years instead of 5.7 years. Projected emissions would fall by approximately 18.9 million SOL over six years, although the estimate does not represent a guaranteed supply reduction.
As crypto.news reported in an Aug. 9 proposal analysis, SIMD-0550 entered Solana’s improvement-document repository with “Review” status on July 23. Inclusion in the repository did not approve or activate the proposed change.
Solana Company said it does not oppose lower issuance as a possible end result. Its objection concerns reopening a fixed schedule that already takes inflation toward the 1.5% terminal rate.
For institutional holders, staking yield can appear as an audited and disclosed financial line item, according to the company. Some holders also treat staking rewards as operating cash flow, making changes in issuance relevant to their revenue forecasts.
The company said it may support another discussion about accelerating disinflation after SOL records sustained net capital inflows.
Solana Company’s reliance on staking revenue makes the issue material to its own accounts. An Aug. 15 earnings report showed that staking generated $2.512 million of the company’s $2.526 million in second-quarter revenue.
During the quarter, it earned 31,200 SOL in staking rewards and automatically restaked the tokens. Revenue from staking helped produce a gross margin of about 97%, but operating costs and losses from digital-asset sales contributed to a $30.3 million quarterly net loss.
SGP-0003 would replace a predictable flat fee
Solana Company also plans to vote against SGP-0003, which supports a resource-based transaction charge and an inclusion fee through SIMD-0553.
Under the design, transaction costs would depend partly on the network resources consumed by each transaction. The resource portion would be burned in full, linking fees more closely to network use than Solana’s existing flat charge.
Galaxy Research previously cited estimates that the proposal could lift daily SOL burns from roughly 650 tokens to between 7,500 and 9,000 under recent network conditions. SIMD-0553’s author later said earlier estimates were “misleading” and published a range of possible outcomes based on the previous month’s activity.
Solana Company agreed that a flat charge does not accurately match fees with the amount of network capacity a transaction consumes. Yet management said the current fee remains a known expense that financial institutions can place in budgets before they use the network.
Introducing variable transaction costs before users and operators have adjusted their systems would transfer estimation risk to them, the company said. Management would consider a revised proposal that maintains a fee floor that institutions can calculate in advance.
U.S. investors have exposure to Solana staking rules
Because Solana Company is listed on the Nasdaq Capital Market, American investors can gain indirect exposure to SOL, staking revenue, and validator operations through HSDT shares without holding the token themselves.
The company’s financial results remain sensitive to SOL prices, staking returns and capital raised through stock sales. During the second quarter, it raised $7.9 million in net proceeds by selling about 3.08 million shares at $2.60 each, while spending approximately $2.3 million to repurchase 1.3 million shares.
Changes to Solana’s issuance schedule could also affect U.S.-listed funds that stake their SOL holdings. An Aug. 11 fund report found that Bitwise’s Solana Staking ETF held 8.18 million SOL worth $622.02 million as of Aug. 9, with 99% of the tokens staked.
Bitwise reported a 6.21% gross annualized staking reward rate over the previous 90 days and a 5.84% net rate after staking-related costs. The fund warns investors that rewards can change with network conditions and do not represent the ETF’s investment performance.
A successful SGP vote would not immediately alter Solana’s issuance or fee rules. Each proposal must secure support from at least 66.67% of the decisive stake, which includes votes for and against but excludes abstentions.
Even after approval, an SGP serves as a policy instruction rather than executable code. Developers would still need to complete the associated Solana Improvement Document, prepare the software, and deploy the change through a feature gate.
Solana Company said it disclosed its positions before voting so delegators would know how their validator operator intended to vote. Under the proposed constitution, the underlying SOL holder can override an operator’s choice by submitting a separate vote.
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