Solana validators vote to keep full control of priority fees

Solana
validators
have
voted
on
SIMD-0096,
a
proposal
to
self-allocate
100%
of
priority
fees,
ending
the
previous
50/50
split
between
burning
fees
and
rewarding
validators.

The
proposal
was
passed
with
a
77%
approval.

According
to
descriptions
of
the
proposal,
it
was
designed
to
address
specific
flaws
in
Solana’s
current
validator
system
while
maintaining
alignment
with
incentives
for
network
security.

While
the
vote
for
this
specific
proposal
is
over,
its
mechanisms
may
take
several
months
to
implement
given
how
Solana’s
mainnet
does
not
support
it
yet.
This
delay
would
allow
for
more
discussion
and
development
for
auxiliary
proposals:
SIMD-0123,
for
streamlining
block
reward
distribution;
and
SIMD-0109,
proposing
a
native
tipping
mechanism.

The
changes
brought
forth
by
the
proposal
would
effectively
reduce
any
potential
side
deals
which
may
happen
between
block
producers
and
transaction
submitters,
a
facet
of
the
validator
system
that
poses
network
security
risks.
Support
for
SIMD-0096
was
forwarded
from
validators
such
as
Jito,
Helius,
Stakehaus,
Bonk,
Leapfrog,
Solend,
Everstake,
and
Pico.sol.
Validators
who
were
not
in
favor
of
the
proposal
included
GREED,
Step
Finance
Solana
Compass,
Shinobu,
Triton,
AG,
Pumpkin
Pull,
Edgevana,
and
Orangefin.

The
opposing
validators
cited
concerns
on
the
potential
impact
of
the
proposal
to
the
long-term
price
of
SOL
and
the
Solana
ecosystem’s
stability.

Critics
such
as
Hanko
Baggins
and
Bandito
Stake
argue
that
removing
the
burning
mechanism
would
leave
Solana’s
annual
inflation
rate
open,
suppressing
SOL
pricing
on
the
long-term.
Solana
co-founder
Anatoly
Yakovenko
addressed
these
criticisms
by
characterizing
priority
fee
burn
as
a
“bug”
in
the
system
which
had
to
be
addressed.
This
is
because
the
current
system
requires
users
to
pay
twice
the
priority
fee
just
to
outbid
tips.
These
are
not
burned,
and
are
transferred
entirely
to
validators.