NEAR Proposes $57M Sovereign Fund to Fund Public Goods via Token Yield

NEAR Protocol co-founder and NEAR Foundation CEO Illia Polosukhin has opened a new governance conversation that could reshape how the network funds its public goods — and how its tokenomics evolve. On Aug. 3 Polosukhin proposed creating a protocol-level sovereign fund seeded with roughly 30 million NEAR (about $57 million at a ~ $1.80 token price). The idea: funnel current and future protocol revenue into a NEAR‑denominated treasury that preserves principal and uses part of its returns to finance network security, validator support, multiparty computation (MPC) providers and other public goods. How it would work - The proposed fund would combine the existing protocol treasury, revenue already earned, and future revenue streams selected via governance. - Rather than immediately spending or burning incoming assets, the treasury would hold NEAR and deploy capital into yield-generating strategies to be defined later by governance. - Yield would be measured in NEAR and used to cover recurring costs for the network’s public infrastructure and services. Why the change Polosukhin framed the idea as similar to sovereign wealth funds or university endowments: preserve a capital base and spend a portion of returns each year. Unlike those models, NEAR’s fund would hold the network’s native token and benchmark returns in NEAR. He argued that burning fee revenue only gives a temporary supply reduction. By acquiring NEAR and generating ongoing yield, the protocol could create a sustained funding source that — if successful — might allow gradual reductions in inflation and even a path toward a fixed token supply. Polosukhin stressed the forum post is a discussion proposal, not a final decision. Context in NEAR’s tokenomics The fund proposal builds on recent tokenomics moves: NEAR cut inflation from about 5% to roughly 2.5% in late 2025, and in February 2026 activated an “Intents” fee switch that directs revenue toward NEAR purchases. The sovereign fund would be the next step tying fee generation to long-term treasury management. Questions and risks the community is raising The proposal does not specify yield strategies, and early forum responses flagged several important trade-offs: - Staking rewards largely come from token issuance, not external revenue, so relying on staking alone may not produce the intended external yield. - Large on‑chain treasuries can compress DeFi returns or introduce market distortions if liquidity is insufficient to absorb capital. - Lending, protocol-owned liquidity, leveraged strategies and other yield tactics add counterparty, smart-contract, liquidation and market risks. Community members have called for exposure limits, independent oversight, and transparent performance reporting against a NEAR‑denominated benchmark. Governance and next steps House of Stake, NEAR’s economic governance body responsible for treasury management, inflation, fees and incentive design, would play a central role, but the proposal has not entered a formal vote. Polosukhin invited validators, tokenholders and stakeholders to comment for two weeks; supporters could then draft detailed governance parameters and a formal proposal. No launch date, target yield, asset allocation or final spending formula has been set. Broader roadmap links The sovereign fund proposal follows other NEAR efforts to tie network usage to token demand — for example, staking‑based payments that convert locked tokens into monthly AI compute credits — and the protocol’s positioning of the Intents system and NEAR as settlement infrastructure for cross‑chain activity and autonomous AI agents. Those initiatives could generate additional fee streams, but their long-term revenue potential remains uncertain. Bottom line: The sovereign fund is an ambitious attempt to turn fee revenue into a durable, NEAR‑denominated endowment for public goods and network security. It has attracted early support and scrutiny; the community debate and subsequent governance design choices will determine whether it becomes a cornerstone of NEAR’s tokenomics or remains an exploratory idea.