Ethereum EIP‑8361 aims to zero issuance once staked ETH hits $112 bn

Ethereum researchers have filed draft EIP‑8361, which would eliminate new ETH issuance once roughly $112 billion worth of ETH (about 60.25 million ETH, or half the current supply) is staked [2]. The move targets the persistent 1.5% staking yield that persists even at very high participation rates, aiming to make additional staking unprofitable and to reinforce scarcity.

Proposal mechanics

EIP‑8361 proposes a linear increase in the burn rate of validator rewards as the staking ratio climbs. When the network reaches the 50 % supply threshold (≈60.25 M ETH), the burn rate would hit 100 %, driving net issuance to zero. The authors note that current issuance peaks at about 0.5 % of supply annually near a 20 % staking ratio before declining [1]. An 18‑month transition period would initially double the base reward factor from 64 to 128, then gradually revert to the current level, allowing yields to start near present levels before tapering down [1].

Market context and reaction

Ethereum’s staking ratio passed one‑third of supply in April, and the researchers estimate that more than 70 M ETH could be staked by January 2028 if the validator entry queue stays near capacity [1]. The proposal has sparked debate: some developers worry that lower yields could advantage large staking operators and reduce the number of independent validators, potentially affecting the network’s economic security [1]. The draft is slated for review during the upcoming Hegotá network upgrade, but inclusion is not guaranteed [1].

What to watch

• Staking ratio milestones – watch for the network crossing the 40 % and 50 % thresholds, which would trigger higher burn rates.
• Hegotá upgrade timeline – inclusion of EIP‑8361 in the upgrade will determine when the new reward curve could become active.
• Validator participation trends – a sustained rise in the validator entry queue or a slowdown in exits could accelerate the approach to the 60.25 M ETH target.

If adopted, EIP‑8361 would fundamentally change Ethereum’s issuance policy, turning staking from a growth‑driven activity into a scarcity‑preserving mechanism and reshaping the economics for both solo and institutional validators. The open question is whether the trade‑off between reduced yields and enhanced scarcity will be accepted by the broader community.