On May 27, Solana validators voted to allocate all priority fees to themselves, ending the previous practice of splitting these fees equally between burning and rewarding validators.

The proposal, SIMD-0096, was approved with 77% support and aims to address perceived issues in the current system by better aligning incentives for network security and efficiency.

This change intends to reduce potential side deals between transaction submitters and block producers, which could compromise network security, according to supporters.

Validators including Everstake, Jito, Helius, Stakehaus, Leapfrog, Bonk, Solend, and Pico.sol supported the proposal, while Step Finance, Triton, GREED, Solana Compass, Shinobu, Orangefin, AG, Pumpkin Pull, and Edgevana opposed it.

Critics like Hanko Baggins from Bandito Stake voiced concerns about eliminating the burn mechanism, which helps control Solana’s annual inflation. Baggins argued that while the increased fees might benefit validators in the short term, the removal of the burn could affect the network’s long-term health and depress the price of SOL.

Solana co-founder Anatoly Yakovenko responded to these concerns, explaining that the current system requires users to pay twice the priority fee to outbid tips, which go entirely to validators and are not burned. He described the priority fee burn as a system bug.

Laine from Stakewiz estimated the change could result in a 4.6% increase in Solana’s issuance, bringing it back to last year’s levels. He noted that SIMD-0096 is part of a broader strategy to improve block reward distribution, with other proposals like SIMD-0123 also being developed.

Despite the vote, implementing SIMD-0096 may take several months due to current Mainnet or upcoming upgrade constraints. This delay allows for further discussion and the development of additional proposals like SIMD-0123, which aims to streamline block reward distribution, and SIMD-0109, which proposes a native tipping mechanism.

The decision to allocate all priority fees to validators reflects diverse views within the Solana community and sets the stage for continued debate about the network’s future. This move comes amid increasing interest in Solana, highlighted by its recent surge to a local high of $210 in March and record-high trading volumes in recent weeks.