NEAR proposal would cut max issuance from 2.5% to 1.6% over 24 months

Sal Ternullo, CEO of liquid-staking operator SVRN, filed a NEAR monetary-policy proposal on the NEAR Governance Forum on September 30, 2026, asking the chain to lower maximum annual issuance from 2.5% to 1.6% over a 24-month, epoch-by-epoch schedule. A vote through the House of Stake — NEAR's dedicated monetary-decision body — is tentatively scheduled for mid-October 2026, anticipated by October 11. If it passes, roughly 66 million NEAR stays unminted versus the status quo, worth about $329 million at the proposal's reference price. Staking yield for validators and delegators drops from ~5.4% to ~3.5% after the full schedule phases in.

What happened

Ternullo's filing turns NEAR's issuance from a static parameter into a scheduled glide path:

• Headline rate. Maximum annual issuance drops from 2.5% to 1.6%.
• Shape. The cut is applied epoch by epoch over 24 months, not as a single step function. Each epoch's maximum issuance is a fractional step along the glide.
• Grace period. A 90-day window precedes the first reduction, giving validators and liquid-staking operators lead time to re-price fees and renegotiate commissions.
• Governance brake. The House of Stake retains the right to pause the schedule, but not to reverse it to a higher rate. Monetary tightening is one-way.
• Distribution unchanged. The split stays at 90% to stakers, 10% to protocol treasury. The treasury's intake falls in absolute terms, in step with issuance.

The vote lands inside NEAR's House of Stake framework, a mechanism the chain adopted to isolate monetary-parameter changes from general governance.

Mechanism — why 2.5% existed in the first place

NEAR's current maximum issuance was set to secure the validator economy at launch: an inflationary subsidy that pays stakers and funds treasury operations until on-chain fee burn and treasury income can carry more of the budget. Three things have changed since:

1. Treasury size. The NEAR Foundation and ecosystem treasury hold a multi-year runway at today's spend.
2. Fee burn. NEAR's fee-burn mechanism retires a meaningful share of gas, dampening net dilution; the effective inflation rate is already below the headline.
3. Validator economics. With a mature validator set and liquid-staking supply from operators like Meta Pool, LST-NEAR and SVRN itself, the subsidy required to retain stake has fallen.

Ternullo's proposal argues the subsidy can shrink without destabilizing the validator set. The 1.6% target was chosen to leave a positive real staking yield after fee burn, under the current validator count.

Numbers

- Proposer                 : Sal Ternullo (CEO, SVRN)
- Filed                    : 2026-09-30, NEAR Governance Forum
- Current max issuance     : 2.5% per year
- Proposed max issuance    : 1.6% per year
- Transition               : 24 months, epoch-by-epoch
- Grace period             : 90 days before first reduction
- Reversibility            : House of Stake can pause, not reverse
- Vote venue               : House of Stake
- Vote window              : mid-October 2026 (by Oct 11)
- Pre-cut staking yield    : ~5.4%
- Post-cut staking yield   : ~3.5%
- Distribution split       : 90% stakers / 10% treasury (unchanged)
- NEAR left unminted       : ~66,000,000 NEAR
- Reference USD value      : ~$329,000,000 at proposal date

Who's affected — and how

• Validators and delegators take the direct cut. A 5.4% → 3.5% yield at the headline level reads as a ~35% drop in staking APR before fee compression.
• Liquid-staking operators (Meta Pool, LST-NEAR, SVRN) will see nominal rewards fall across every stNEAR variant. Operators that take percentage commissions take a proportional hit; operators on fixed fees compress their own margin.
• DeFi lending markets that use stNEAR as collateral will see the collateral's native yield drop, shifting the economics of leveraged staking.
• The treasury gets 10% less of a smaller pie; the dollar impact depends on where NEAR trades through the schedule.

What to watch

1. The House of Stake vote. Participation thresholds and the quorum rules will matter — a thin turnout vote on a 24-month monetary change is a weaker signal than a high-turnout one. The forum thread (filed Sept 30) is the primary document; the on-chain vote execution tx, when the vote settles, is the artifact to link.
2. Validator defection risk. If a meaningful share of stake unbonds when yield compresses, the security budget shrinks faster than the issuance cut delivers. The unbonding window gives early warning.
3. LST competition. Lower native yield compresses the margin for LST operators; expect fee cuts or feature differentiation. SVRN proposing the cut is itself a signal that the largest operators think they can absorb it.
4. Follow-on parameters. A successful issuance cut tends to invite proposals on the distribution split and on fee-burn mechanics. The House of Stake precedent set here matters for those.

Context — the "tighten monetary" trade keeps spreading

NEAR's cut sits in a wider pattern. Over the past 18 months, Polkadot completed its two-stage inflation reduction, Cosmos Hub executed Prop 848's cap drop, and Celestia passed a tapered-issuance proposal in Q2 2026. Each sold the same case: reduce dilution now that the validator set is mature, lean more on fees. The counter-pattern is the EIP-8363 withdrawal on Ethereum earlier this week, where a tapered-issuance proposal was pulled back after validator pushback over the sequencing of burn and issuance changes. The House of Stake vote lands with that precedent fresh.

Sources

• NEAR Governance Forum: gov.near.org
• Crypto Briefing: NEAR Protocol weighs proposal to cut token issuance to 1.6% over two years