Solana tops $109, 8-month high against Bitcoin as supply vote closes

Solana climbed past $109 against Bitcoin on Thursday, an eight-month high for the SOL/BTC pair, as traders priced in a supply squeeze from the network's first binding governance vote.

The rally lands the same day validators close voting on two tokenomics proposals — SIMD-550 and SIMD-553 — that would double the disinflation rate and boost daily SOL burns as much as 14-fold, according to Solana Developers.

SOL gained more than 8 percent in 24 hours and roughly 44 percent this month, its strongest month since 2024, with network activity hitting a record 1.32 billion transactions between Aug. 17 and 23. The token's 14-day RSI sits near 84.5, a level typically flagged as overbought.

The vote outcome, expected within hours of epoch 1023 closing at 15:30 UTC, will determine whether staking yields fall from about 5.25 percent to roughly 2.25 percent within three years, per a 21Shares analysis — a trade-off between supply reduction and validator economics.

Two Proposals, One Supply Squeeze

SIMD-550, filed by engineers at Solana infrastructure firm Helius, would double the network's disinflation rate from 15 percent to 30 percent annually, reaching the 1.5 percent inflation floor by 2029 instead of 2032. That works out to roughly 18.9 million fewer SOL created over the next six years.

SIMD-553, from Solana R&D firm Temporal, splits transaction fees into a base inclusion fee that pays validators and a new resource fee tied to computational cost that gets destroyed. The change would take Solana's daily burn from about 650 SOL, worth roughly $48,000, to as much as 9,000 SOL, worth around $668,000 — a 12-to-14-fold jump depending on network activity.

Both proposals need a two-thirds supermajority of participating stake, voted on independently. Nasdaq-listed treasury firm Solana Company, which trades as HSDT, is backing the constitution but voting against both tokenomics changes, citing timing concerns for institutional stakers rather than disagreement with the goals.

Macro Tailwinds Lift the Whole Market

The SOL rally sits within a broader crypto upswing. Bitcoin staged its strongest weekly rally since March 2023, climbing 23.6 percent last week and breaking through $80,000 for the first time since mid-May. The immediate macro trigger was the U.S. Treasury's decision to at least double its buybacks of longer-maturity government bonds, from $2 billion to $4 billion a month, aimed at bringing down long-term yields that had surged to levels last seen in 2007.

André Dragosch, Head of Research Europe at Bitwise, pointed to the Treasury buyback decision as the primary driver, citing a weaker dollar and a more accommodative fiscal stance, according to Morningstar. Analysts now watch the Federal Reserve's Jackson Hole symposium for the next signal, with new Fed chair Kevin Warsh's comments on monetary policy expected to shape Bitcoin's path toward the $80,000 breakout.

For SOL, the immediate question is whether the governance vote passes and how quickly the supply effects materialize. With the 14-day RSI near 84.5, the token is overbought by most technical measures, and a rejection of either proposal could trigger a sharp pullback from current levels.

This article is for informational purposes only and does not constitute investment advice.