NEAR’s Inflation Halving Hangs On Validator Vote

A live on-chain vote could slice NEAR (NEAR) token inflation from five percent to two-point-five, rewriting economics for stakers and dApps alike. 

Passing requires “Yes” from two-thirds of staked validators. If that super-majority materializes, core devs will ship the reduced inflation logic in the next protocol upgrade, targeting late Q3 2025.

Rationale For The Cut

Because sharding makes gas cheap, burn pressure remains low, so high inflation feels excessive. Halving issuance slows supply growth, supporting long-term scarcity and edging the asset toward eventual deflation as network fees rise. 

Heavyweights at Electric Capital, Dragonfly, Frax (FRAX), and Gauntlet have tweeted support, arguing that scarce NEAR strengthens treasury models and investor confidence.

Impact On Staking Rewards

Base APR would fall to roughly four to four-and-a-half percent. To cushion the drop, Meta Pool and LiNEAR drafted a lockup “boost” program: delegators who stake with eligible validators and commit tokens for one-to-six months can earn up to two extra percentage points. 

Smaller validators get growth subsidies; large nodes gain access to discounted stake, ensuring network security despite thinner issuance.

Voting Mechanics

Each validator signs through LiNEAR’s portal; delegators may restake with a validator whose vote matches their stance, dynamically shifting the tally. Failure to hit 66.67 % keeps inflation at five percent. 

Approval lowers the ecosystem-treasury share to 0.25 % (still 10 % of total issuance) and activates new reward math at the next epoch after upgrade.

In A Nut Shell

Lower inflation eases sell pressure from reward harvesting, potentially supporting price action and encouraging long-term holding. Conversely, leaner yields could squeeze small validators if incentive programs underperform. 

The decision forces every stakeholder (developers, validators, delegators) to weigh near-term revenue against future scarcity. Whatever the outcome, the vote sets a precedent for dynamic inflation management across proof-of-stake networks.

Analysts are mixed on how the vote, if successful, could impact price action. However, a look at other cryptocurrencies that have cut their rewards has resulted in selling pressure upon a successful governance vote to do so. 

Also See: Worldcoin Locks Minors Out - Privately

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