Ethereum developers propose burning validator rewards to curb staking growth
A group of six researchers submitted a draft Ethereum Improvement Proposal that would burn a growing share of validator rewards.
The plan would burn the validator rewards in accordance with how much ETH gets staked. It addresses the fact that there is currently no point where the incentive to stake more ETH shuts off.
What is the Tapered Issuance Burn?
Six researchers, including Jérôme de Tychey, Ladislaus von Daniels, and Justin Drake from the Ethereum Foundation, have put forward a proposal that would change how Ethereum pays validators by deducting from the rewards validators already earn.
The deduction grows as the staking ratio climbs, and when the staking ratio hits around half of all ETH supply, the deduction reaches 100%.
Since the Merge in September 2022, Ethereum’s execution-layer issuance has been zero, and stakers receive roughly 1,700 ETH a day, although that figure shifts with the amount staked.
The proposal also spread out the change over a period of 18 months to avoid a sharp drop in yields.
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