Solana validators voted on May 27 to change the allocation of priority fees, moving from a previous 50/50 split between burning fees and rewarding validators to allocating 100% of these fees to themselves. The proposal, known as SIMD-0096, was approved with 77% support. Its goal is to address perceived weaknesses in the current system and align incentives to enhance network security and efficiency.

Supporters of the change argue that it reduces the potential for transaction submitters to negotiate side deals with block producers, which they believe could compromise network security. Leading validators such as Everstake, Jito, Helius, Stakehaus, Leapfrog, Bonk, Solend, and Pico.sol backed the proposal.

However, some validators, including Step Finance, Triton, GREED, Solana Compass, Shinobu, Orangefin, AG, Pumpkin Pull, and Edgevana, opposed SIMD-0096. Critics, like Hanko Baggins from Bandito Stake, expressed concerns about removing the fee burning mechanism, which helps manage Solana’s inflation rate. They fear this change could impact the network’s long-term health and suppress SOL’s price.

Solana co-founder Anatoly Yakovenko defended the proposal, describing the current fee burn mechanism as a system bug that forces users to pay double the priority fee to outbid tips, which go entirely to validators and are not burned.

Laine from Stakewiz estimated that SIMD-0096 could increase Solana’s issuance rate by 4.6%, aligning it with levels from a year ago. He emphasized that this change is part of a broader effort to refine block reward distribution, with additional proposals like SIMD-0123 also under development.

Despite the vote’s conclusion, the implementation of SIMD-0096 may take several months due to current limitations in the Solana Mainnet or upcoming upgrades that do not yet support it. This delay allows for further discussions and the development of complementary proposals such as SIMD-0123 and SIMD-0109, which introduces a native tipping mechanism.

The decision to allocate 100% of priority fees to validators reflects the diversity of viewpoints within the Solana community and sets the stage for ongoing debates about the network’s future. This move occurs amid heightened interest in Solana, following its recent peak at $210 and increased trading volume in recent weeks.