- Solana validators have approved the SIMD – 0096 proposal, eliminating the burn rate on priority transactions.
- Over 77% of the participants voted in favor of the proposal granting validators full priority fees.
- With the SIMD proposal’s approval, SOL’s price experienced a more than 5% increase.
Solana validators are about to receive more rewards (SOL tokens) because of the approval of the SIMD – 0096. Over 77% of the network validators who participated in the on-chain vote supported the proposal, including Jito, Helius, Solend, Everstake, and many others.
Elimination of 50% Burn Rate on Priority Transactions
Solana Improvement Documents (SIMD) – 0096 proposes changing the current priority fee structure to increase rewards for validators. Solana’s priority fees are additional fees users can pay to increase the possibility of the network choosing their transactions more quickly.
Previously, 50% of the priority fees were burnt, and the remaining 50% will be rewarded to validators. However, the proposal eliminates the burn rate on priority transactions, sending all the priority transaction fees to the validators. This would ensure all validators are focused on keeping the network safe and running smoothly.
This proposal also eliminates all possible side deals between block producers and transaction submitters to get more SOL, improving incentives within the validator system.
SOL’s Price Increase
Solana’s price increased by more than 5% on May 27, 2024, after the SIMD-0096 proposal was approved. Investors hope for continued growth, with SOL breaking the resistance level near $190. The anticipation comes on the heels of a previous hike to $188.90, just a little short of breaking the resistance.
Solana’s Market Action Mirrors February Trends, Positive Shift Expected in JuneLaine, a Solana staking validator, noted that the SIMD-0096 proposal might impact the Solana network by making SOL more inflated. The validator also pointed out that the priority fees were absent in May of last year, indicating that the inflation rate would revert to 9.9% annually.
Stagnation Below $190
Some people believe that the approval of the Spot Ether exchange-traded fund (ETF) is responsible for Solana’s recent price adjustment to $161. In the past week, Solana experienced a 5% increase in dApps volume, which is underperforming compared to Ethereum’s 52% increase. Furthermore, based on the stagnant on-chain activity and elimination of the burn mechanism, there is a very low possibility of reclaiming and breaking past the previous high of $188.90.
