Author: The Defiant Team

Translation: TechFlow

TechFlow Overview: The NEAR on-chain governance organization House of Stake has canceled the "developer Gas rebate" mechanism, which has been in operation for many years, through proposal HSP-027. Originally, 30% of the Gas fees generated by smart contract calls were returned to the contract owner, but this percentage will now drop to 0%, and all fees will be destroyed. At a time when L1 token economics is generally being reshaped, NEAR's step makes token issuance more deflationary and reveals how early incentive designs are disconnected from real business models.

From "30% Rebate" to "All Destroyed"

NEAR's on-chain governance organization House of Stake has canceled the developer gas rebate mechanism through proposal HSP-027. After this change takes effect, all Gas fees on the network will be used for destruction, with no portion being returned to the smart contract owners.

Under the current design, 30% of the Gas fees generated from calling a smart contract goes to the contract owner, while the remaining 70% is destroyed. According to a delegate who participated in the voting, after the nearcore v2.14 version (expected around August 2026) goes live, the rebate ratio will drop to 0%, which means that all Gas fees will be destroyed.

The voting result was overwhelmingly in favor: a total of 46 votes, representing 4.66 million veNEAR (the NEAR held in voting custody) supported; only 2 votes against, representing 1,819 veNEAR. NEAR co-founder Illia Polosukhin confirmed the result on Monday, stating it is a step toward making the NEAR Protocol more streamlined and cleaner in the future.

Why Change? Complexity and Misaligned Incentives

NEAR's developer relations account had hinted at this vote as early as the beginning of July, reminding developers: "Don't count this Gas reward in your dApp's budget anymore." The NEAR governance account described this move as aimed at reducing "protocol complexity and misaligned incentives for developers."

Polosukhin originally designed this rebate mechanism to incentivize developers to build reusable components. However, he stated that the mechanism no longer reflects the monetization methods of most NEAR applications—the project teams typically pay Gas costs upfront and recover revenue through spreads, subscriptions, or advertisements, rather than relying on on-chain rebates. He also pointed out an accounting issue: it's hard to distinguish this rebate from ordinary user fund deposits.

A Stress Test of "Economic Parameter Governance"

Polosukhin views this vote as a "trial run" for the House of Stake to take over NEAR's core economic parameters. He called it a "great test" before more proposals in the future and expressed his satisfaction at having a clear governance mechanism for the $NEAR economic model.

This change, by eliminating an exception item in fee destruction, makes NEAR's token issuance more deflationary; however, it does not alter the broader value capture model of the network.

Another Round of "Slimming Down" in L1 Token Economics

In the fiercely competitive L1 landscape of 2026, NEAR's step is not isolated but rather part of the larger trend of token economics "shifting from subsidies to deflation." When the early narrative of "incentivizing developers with rebates" meets the reality of application parties generally covering Gas costs out of pocket and making profits from the product itself, the rebate mechanism becomes a "historical burden" that increases protocol complexity and is hard to reconcile.

By canceling it, NEAR is handing over more control of token supply and demand back to the destruction mechanism itself—every on-chain activity reduces circulating supply, rather than quietly subsidizing certain participants. For holders, this presents a clearer deflationary narrative; for developers, it means returning to the simple proposition of whether "the product itself can create value." Through this, House of Stake formally takes over core economic parameters, indicating that the iteration of L1 token models will increasingly be directly decided by on-chain governance.