$NEAR co-founder Ilya Polosukhin called on network participants to consider creating a protocol fund for investments. The fund will hold $NEAR tokens, generate revenue, and spend part of that revenue on securities and other public goods.
On Monday, he posted this idea on the $NEAR governance forum, setting a two-week period for community members to share their proposals.
Polosukhin Calls for Public Participation
"This is just a proposal, not a mandatory requirement," he wrote. "I believe our ecosystem belongs to all of us and will not be truly sustainable or decentralized if the founder makes all the decisions," he continued.
Before taking any action, he wants to hear from validators and token holders voting through the House of Stake, as well as the community.
$NEAR is preparing to begin its sixth year of mainnet operation. Polosukhin called the first five years the self-funding stage. According to him, recent preparatory work includes cutting inflation in half by the end of 2025, changing the fee system that directs $NEAR Intents revenue to token buybacks, and introducing fees for executing artificial intelligence tasks.
According to the post, the proposed treasury fund would be funded from the existing $NEAR protocol treasury and protocol revenue collected to date and to be collected in the future. The fund will hold tokens in $NEAR and use them to fund the validator support program, MPC service providers, and other similar services. At launch, the fund will have approximately 30 million $NEAR, or about $53 million at current prices.
Delegate participation in $NEAR's governance system based on weighted stake (House of Stake) will be through already existing mechanisms. Polosukhin suggested that over time, $NEAR could redirect an increasing share of emissions into the fund. This would reduce effective inflation while still rewarding validators and staking participants.
Norway and Singapore Serve as Models
Sovereign wealth funds and university endowments turn one-time or cyclical revenues into a permanent asset base that generates income year after year.
Polosukhin cited Norway and Singapore as examples. Singapore's fund is 45 years old, and Norway's is 36, demonstrating the ability of such a structure to withstand market cycles. Cryptocurrency revenues are just as cyclical as oil or land sales, he stated, so investing them in a productive fund is better than paying bills directly.
He drew a clear distinction between this process and token burning, a mechanism the $NEAR community had previously discussed. Burning temporarily offsets inflation, he said, but that effect disappears in the case of a volatile asset, and once inflation stops, nothing remains. He likes the simple math: the same tokens are lent out for revenue, and the principal continues to generate funding.
In early July, Polosukhin rejected a proposal to burn tokens held in the Fund, stating that a one-time burn is a "crude tool," and instead pointed to the possibility of introducing a hard cap on the $NEAR supply, akin to Bitcoin. The fund facilitates this. If the yield can eventually cover network security and public goods expenses, he wrote, $NEAR "could approach a fixed supply."
The Near Foundation co-founder acknowledged that yield comes with risk. The plan is to diversify and hedge risks, and any inflation adjustment should keep the incentives for validators and staking unchanged. $NEAR traded at $1.74, up 1.4% on the day but down 29.6% over the year.
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