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<p>Voters in House of Stake, the onchain governance body of <a href="https://x.com/NEARProtocol" rel="noopener noreferrer nofollow">@NEARProtocol</a>, approved a proposal to lower the maximum yearly issuance of <a href="https://x.com/search?q=%24NEAR&amp;src=cashtag_click" rel="noopener noreferrer nofollow">$NEAR</a> from 2.5% to 1.6%. The reduction will phase in step by step over 24 months, starting after a grace period of about 90 days.</p>
<p>The decision is a governance approval, not an immediate change to the network. The proposal still needs a review by the House of Stake Security Council and a protocol upgrade adopted by validators before it takes effect.</p>
<h2 id="what-the-proposal-changes">What the Proposal Changes</h2>
<p>The measure is known as HSP-029. <cite>It calls for a 90-day grace period after ratification, followed by a gradual reduction over 24 months.</cite><cite>The current allocation of new tokens would stay the same: 90% to staking participants and 10% to the protocol treasury.</cite></p>
<p>The proposal estimates about 11.8 million fewer NEAR would be minted over two years. <cite>That figure is measured against a constant 2.5% regime, and it is a projection from the proposal rather than a realized outcome.</cite><cite>Over six years, the proposal estimates a reduction of about 66.1 million tokens, equivalent to a 4.36% reduction in supply compared with the current level.</cite></p>
<p>Gross staking yield would ease from about 5.3% to 3.4% once the new rate is reached. <cite>Using the network's Sept. 22 staking ratio, the proposal models yield falling from 5.268% to 3.372%, and the actual figure at the end of the ramp will depend on conditions at the time.</cite></p>
<h2 id="trade-offs-for-stakers-and-validators">Trade-Offs for Stakers and Validators</h2>
<p><cite>A lower issuance ceiling would reduce dilution for holders who do not stake, while leaving fewer newly issued tokens for staking rewards.</cite><cite>The move from 2.5% to 1.6% is a 36% reduction of the starting cap, according to CryptoSlate.</cite></p>
<p>Validator adoption is a separate step. <cite>Polkachu has indicated it would adopt the corresponding upgrade.</cite><cite>The proposal follows an earlier issuance debate on a reduction from 5% to 2.5% in June 2025.</cite></p>
<p>Holders who stake $NEAR should check how their chosen validator plans to handle the upgrade, since the reduced issuance would only apply once validators move to the new protocol version.</p>
<p>Sources:</p>
<ul>
 <li><a href="https://houseofstake.org/proposals/29" rel="noopener noreferrer nofollow">House of Stake proposal 29 (HSP-029)</a></li>
 <li><a href="https://gov.near.org/t/hsp-029-establish-a-24-month-issuance-ramp-to-a-1-6-target-rate-of-near-token-emissions/42644" rel="noopener noreferrer nofollow">NEAR Forum: HSP-029 issuance ramp proposal</a></li>
 <li><a href="https://www.tokenpost.com/news/technology/36519" rel="noopener noreferrer nofollow">TokenPost: NEAR Governance Opens Vote to Cut Annual Token Issuance to 1.6%</a></li>
</ul>

NEAR Protocol House of Stake Approves Cut to Maximum Annual NEAR Issuance to 1.6%

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