EIP-8363 proposal to burn staking rewards stalls at first upgrade hurdle
A draft Ethereum proposal, EIP-8363, would burn a portion of validator rewards as the staked ETH supply grows — ultimately driving new staking rewards to zero. Its authors argue the network overpays for security it already has and that a formally agreed reference rate is needed.
- Staked ETH hit a record 41.7 million (a third of all ETH), even as the price fell from ~$3,400 in January to ~$1,900.
- The proposal failed its first upgrade hurdle this month (ACD meeting), after some of DeFi's largest builders and treasury companies moved to stop it.
- Critics note treasury companies and spot ETF issuers have built positions around staking yield, and that the rate no one formally set prices much of the on-chain economy.
Sources
- $ETH treasury companies and spot ETF issuers have built positions around staking yield. A proposal to take that yield to zero failed. https://t.co/It27Q5NfEd Quoting @BitfinexReplies: https://t.co/55BB4OX3kpx.com ↗
- Almost the entire on-chain economy is priced off a rate nobody formally set. A proposal to taper it to zero failed at Ethereum's first upgrade hurdle this month. DeFi's largest builders moved to stop it. Who actually sets Ethereum's monetary policy? https://t.co/mffvlVkimrx.com ↗
- The Fight Over Ethereum’s Security Budgetblog.bitfinex.com ↗
- Ethereum's staking reward never runs out. A draft proposal would change that. EIP-8363 burns validator rewards as staking rises, taking new rewards to zero. Its authors say the network overpays for security it has. Businesses earning that yield disagree. https://t.co/tpUy1m3BvV Quoting @bitfinex: Staked $ETH has climbed to a record 41.7 million, a third of all ETH in existence, while price fell from $3,400 in January to $1,900. As the amount staked grows, the rewards do not run out, which is why the pile keeps growing. https://t.co/m5AU9GQ4eBx.com ↗
