Ethereum Researchers Propose Tapered Issuance to Curb Staking Growth

A group of six Ethereum researchers and developers, including the Ethereum Foundation's Justin Drake, has proposed changes to the network's issuance policy. They want to cut validator rewards more sharply as the proportion of staked ETH rises.

The draft proposal, called Tapered Issuance Burn (EIP-8363), would burn an increasing fraction of validators' consensus rewards as the amount of staked ETH approaches a fixed threshold of 60.25 million ETH (around 50% of the current ETH supply). The changes would phase in over 18 months.

The proposal's authors, including Jérôme de Tychey, argue that continued staking growth could concentrate ETH in large custodians and liquid staking providers. They also claim that unchecked issuance erodes Ether's role as a neutral, trustless store of value.

However, critics say the reward cuts would force out solo validators before larger institutions are affected, weaken institutional demand for ETH, and disrupt DeFi markets built around staking yield.