NEAR Governance Vote Abolishes Developer Gas Refunds: 30% Subsidy Eliminated, All Fees Transferred to Burn

Author: The Defiant Team

Translated by: TechFlow

TechFlow Editor's Note: NEAR's on-chain governance body House of Stake passed proposal HSP-027, canceling the long-running 'Developer Gas Rebate' mechanism—originally 30% of the Gas fees generated from smart contract calls were rebated to the contract owner, now this ratio will drop to 0%, with all fees burned. At a time when L1 token economies are generally being reshaped, this move by NEAR makes token issuance more deflationary and also exposes how early incentive designs have become disconnected from real business models.

From '30% Rebate' to 'All Burned'

NEAR's on-chain governance body House of Stake passed proposal HSP-027, canceling the protocol's developer gas rebate mechanism. After the change takes effect, all Gas fees on the network will be used for burning, and no portion will be rebated to smart contract owners.

Under the current design, 30% of the Gas fees generated from calling a smart contract go to the contract owner, and the remaining 70% are burned. According to a validator who participated in the voting, after the nearcore v2.14 version (expected around August 2026) goes live, the rebate ratio will drop to 0%, meaning all Gas fees will be 100% burned.

The voting result was one-sided: a total of 46 votes, representing 4.66 million veNEAR (NEAR locked for voting), were in favor; only 2 votes against, representing 1,819 veNEAR. NEAR co-founder Illia Polosukhin confirmed this result on Monday, calling it a step to make NEAR Protocol simpler and cleaner going forward.

Why the Change? Complexity and Misaligned Incentives

NEAR's developer relations account previewed this vote as early as early July and reminded developers: 'Stop counting this Gas reward in your dApp's budget.' The NEAR governance account described this move as aimed at reducing 'protocol complexity, as well as misaligned incentives for developers.'

Polosukhin originally designed this rebate mechanism to incentivize developers to build reusable components. But he stated that this mechanism no longer reflects the monetization methods of most NEAR applications—project teams usually advance Gas costs themselves and then recover revenue through spreads, subscriptions, or advertising, rather than relying on on-chain rebates. He also pointed out an accounting-level issue: this rebate is difficult to distinguish from users' ordinary fund deposits.

A Stress Test for 'Economic Parameter Governance'

Polosukhin views this vote as a 'trial run' for House of Stake taking over NEAR's core economic parameters. He called it 'a great test' before more proposals in the future and stated 'happy to have a clear governance mechanism for $NEAR's economic model.'

This change makes NEAR's token issuance more deflationary by removing an exception in fee burning; but it does not change the network's broader value capture model.

Another Round of 'Slimming Down' for L1 Token Economies

In 2026, amidst fierce L1 competition, this step by NEAR is not an isolated case, but part of the broader trend of token economies 'shifting from subsidies to deflation'. When the early narrative of 'incentivizing developers with rebates' meets the reality that application parties generally advance Gas costs out of their own pockets and profit from the product itself, the rebate mechanism becomes a 'historical burden' that both increases protocol complexity and is difficult to reconcile.

Canceling it means NEAR returns more initiative over token supply and demand to the burning mechanism itself—every on-chain activity reduces circulating supply, rather than quietly subsidizing certain participants. For token holders, this is a clearer deflationary narrative; for developers, it means the incentive logic returns to the simple proposition of 'whether the product itself can create value'. House of Stake officially takes over core economic parameters through this, also signaling that L1 token model iterations will increasingly be decided directly by on-chain governance.