NEAR Governance Approves Plan to Lower Issuance Cap to 1.6%

NEAR launched with a fixed 5% issuance schedule that was later cut to a 2.5% annual maximum, with 90% of new tokens funding staking rewards and 10% going to a protocol treasury. House of Stake, the network's on-chain governance body, now functions as the venue where token holders and validators vote on changes to that split. HSP-029 is the first vote to touch the issuance cap itself rather than how the proceeds are divided.

Stakers face a gradual decline in yield as issuance falls to 1.6% over 24 months, with 11.8 million fewer NEAR entering circulation in that window and 66.1 million fewer over six years. Validators will need to recalculate whether their operations stay profitable at lower reward rates, and treasury-funded grants tied to the 10% allocation will shrink in absolute terms even though the percentage split is unchanged.

Cutting issuance to curb dilution is a trade-off against the reward pool that pays for network security: lower inflation can support long-term holders but weakens the economic incentive that keeps validators staking. NEAR's choice to preserve the 90/10 structure rather than redesign it suggests governance wants to slow supply growth without reopening a fight over how rewards are distributed, a more conservative path than a full tokenomics overhaul.

The vote is not final: Security Council ratification and a validator-adopted protocol upgrade must still occur before the lower cap takes effect. A rejection or delay at either stage would leave the 2.5% ceiling in place, while ratification would start the 24-month countdown to 1.6%, the detail that determines when stakers actually see reduced yields.

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