NEAR Targets Fixed Token Supply With New Sovereign Fund Proposal

NEAR Protocol co-founder Illia Polosukhin has put forward a proposal to establish a Sovereign Fund seeded with 30 million $NEAR tokens, in what would mark a significant shift in how the network funds its core operations and incentivises participants.

The fund is designed to generate yield, which would then be distributed to validators, security providers, and public goods projects. If the model proves sustainable, it could pave the way for NEAR to eventually adopt a fixed token supply, ending the current inflationary issuance model.

A Break From Inflation-Driven Rewards

The proposal reflects a broader push within the NEAR ecosystem to rethink its tokenomics. Polosukhin has publicly dismissed community proposals to burn tokens held by the NEAR Foundation, arguing that simple token burns have historically failed to deliver meaningful benefits to markets or network ecosystems. Instead, he advocates for a fixed maximum supply model similar to Bitcoin's, which would cap total $NEAR tokens and move away from the current inflationary approach to rewarding validators.

This is not the first time the network has moved in this direction. On October 30, 2025, NEAR's inflation rate was cut from 5% to 2.5% annually, roughly halving new token issuance from around 64 million to 32 million $NEAR per year, with the long-term effect of reducing sell pressure from validator rewards. Then, on February 23, 2026, the NEAR Intents fee conversion mechanism activated, routing 100% of Intents fees into open-market $NEAR purchases.

Community Input Before Any Vote

The Sovereign Fund proposal remains in its early stages. The plan is open for community feedback before any formal governance vote takes place, and it also aims to improve treasury transparency through on-chain governance mechanisms.

The community will ultimately determine whether the Sovereign Fund advances to a formal vote. The move away from short-term mechanisms in favour of a fixed supply model represents a meaningful departure from conventional tokenomics, and signals a focus on sustainability that could influence how other blockchain networks approach supply management.

Sources:
CryptoNews: Near Protocol Co-Founder Rejects Token Burn Proposal, Advocates Fixed Supply Model
ChangeNow: NEAR Protocol Overview in 2026
NEAR Foundation: Supporting Community Proposals to Upgrade NEAR Tokenomics