Solana, Ethereum ponder major changes

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A version of this article appeared in our The Decentralised newsletter on April 15. Sign up here.

GM, Aleks here.

Solana has capitalised on Ethereum’s woes.

Consider this: last June, Ethereum accounted for 70% of all money in decentralised finance. As of Monday, that figure had fallen to 57%.

Solana, meanwhile, has doubled its share in that span. It now accounts for one of every 10 dollars in DeFi.

Two recent proposals could further alter the balance of power. Let’s talk about Solana’s first.

Last week, crypto firm Galaxy resurrected a debate that could have major implications for the blockchain’s native cryptocurrency and its myriad DeFi applications.

Back in January, partners at venture firm Multicoin Capital proposed slashing inflation of the Solana cryptocurrency by reducing the incentive to stake — the activity that secures the blockchain and generates new Solana.

Reducing the amount of newly issued Solana would boost its price and lead investors to seek higher returns in DeFi protocols, they argued.

Their proposal received support from ecosystem heavyweights, but a wave of late no votes meant it failed to garner the supermajority needed to pass.

Now, Galaxy’s research arm is taking another stab at reducing Solana inflation.

Galaxy has proposed letting Solana validators vote on reducing inflation. Those who vote yes will have a number of options: Reduce it by 20%? By 25%? More?

Should yes votes hit the needed supermajority, the size of the inflation reduction would be a weighted average of those voters’ choices.

But some in the community have already pushed back against the proposal, arguing it will enable validators to game the system by voting for outsize changes in hopes the average will better align with their desired outcome.

In Ethereum land, meanwhile, co-founder Vitalik Buterin dropped a surprise proposal over the weekend. Optimism contributor Binji Pande likened it to blockchain brain surgery.

Without getting too deep in technical gobbledygook, Buterin has proposed using popular programming language RISC-V in lieu of the Ethereum Virtual Machine.

Doing so would improve the efficiency of the Ethereum execution layer, according to Buterin, “resolving one of the primary scaling bottlenecks.”

Remember: much of the recent angst has been targeted at the decision to leave Ethereum as a sort of premium product for power users willing to tolerate high transaction fees in exchange for better security, while outsourcing performance and affordability to so-called layer 2 blockchains, such as Arbitrum and Optimism.

Pande also likened the change to swapping out a car’s engine.

Anyone who remembers the last engine-swapping metaphor will remember Ethereum’s Merge upgrade went off without a hitch, albeit years late. Any change to the Ethereum Virtual Machine is a long way off.

Nevertheless, Buterin’s proposal is a sign he’s listening to the critics, and a sign Ethereum won’t let Solana take the DeFi crown lying down.

This week in DeFi governance

VOTE: Lido DAO votes to renew and tweak delegate incentives

PROPOSAL: Aave DAO considers renewing Aave Chan Initiative partnership

PROPOSAL: Arbitrum DAO considers new DeFi incentives program

Post of the week

Nick Johnson of Ethereum Name Service wasn’t the only one to suffer a sophisticated phishing attack last week.

Recently I was targeted by an extremely sophisticated phishing attack, and I want to highlight it here. pic.twitter.com/2Q5ARwAqR6
— Tony (@0xRacist) April 16, 2025