Ethereum Foundation developers push 50% cap on staking supply

Ethereum Foundation researcher Justin Drake and other core developers have formally submitted EIP-8361, a proposal aimed at curbing excessive staking. The proposal centers on a tapered issuance burn mechanism under which new validator issuance rewards would converge toward 0% once staked ETH reaches 50% of total supply. As the staking ratio rises, part of validator rewards would be burned, and once staking reaches about 60.25 million ETH, or roughly 50% of total supply, all newly issued rewards would be fully burned. The developers plan to discourage unnecessary over-locking of ETH and reduce centralization risks while allowing staking participation to settle organically below 50%. To limit market disruption, the reward reduction would be phased in gradually over 18 months. Previously, Aave founder Stani Kulechov had raised concerns that the proposal could prompt institutional investors focused on stable cash flow to shift attention from ETH to other blockchain networks.