Ethereum Researchers Propose Tapered Issuance Burn to End Staking Incentives

A group of Ethereum researchers has proposed a new draft proposal called EIP-8361 to end staking issuance at 50% of the ETH supply. The proposal, dubbed Tapered Issuance Burn, would gradually reduce validator rewards as more ETH is staked.

The burn rate would increase alongside Ethereum's staking ratio and reach 100% when approximately 60.25 million ETH is actively staked, roughly half of the current supply. This means that validators would receive lower rewards for their attestations, block proposals, and sync committee participation.

The researchers argue that the current issuance curve continues to offer a yield of around 1.5% even if nearly all ETH is staked, providing no point at which issuance stops encouraging additional staking. They estimate that more than 70 million ETH could be staked by January 2028 if the validator entry queue remains near its maximum rate and exits remain limited.

The proposal would take effect across the full staking curve from activation, meaning issuance would no longer provide an incentive for staking growth beyond the 50% threshold from the first day. The authors are seeking to have EIP-8361 considered for the proposed Hegotá network upgrade.