Ethereum staking reward burn proposal EIP-8363 pulled from Hegota upgrade

The co-authors of EIP-8363, a proposal to burn a rising share of Ethereum validator rewards as more Ethereum (ETH) is staked, have withdrawn it from consideration for the network's Hegota upgrade. 

"Withdrawing EIP-8363 from consideration for Hegotá," co-author Jérôme de Tychey, president of Ethereum France, wrote in an X post on Thursday morning.

De Tychey said several industry participants, as well as core protocol and client contributors, argued during Hegotá's Consideration for Inclusion (CFI) process that "a fork scoping exercise was not the right venue to settle an issuance policy change."

"We agree and we'd rather acknowledge this now than carry on towards Hegotà in this context," he wrote, noting that the proposal had become "one of the most commented-on EIPs in the history of the Ethereum-Magicians forum." 

The authors committed to a separate process for determining questions of Ethereum's issuance policy. De Tychey thanked liquid staking protocol Lido for offering to help steer it.

A separate, dedicated process

De Tychey grouped the objections raised since August into five categories: security, industry impact, the design of the burn curve, the makeup of the validator set and the effect on solo stakers.

To determine how to proceed with tackling the issues, de Tychey attached a timeline for what he called a "multi-node process." It starts with an issuance forum at Devcon in November, following a first roundtable at EthCC 2026.

Workshops would follow after Devcon and in February and March, with a tentative forum at a Columbia University cryptoeconomics workshop in January.

The schedule ends with a forum at EthCC in April, where the authors aim to engage core developers and reach CFI or Scheduled for Inclusion (SFI) status for a proposal.

De Tychey said the authors stand by the proposal's motivation. He quoted the EIP's view that a very high staking ratio threatens "Ethereum's security, neutrality and resistance to capture" as well as "ETH's role as money."

The proposal

Researchers including the Ethereum Foundation's Justin Drake, Pintail, de Tychey, dapplion, pa7x1 and Ladislaus von Daniels proposed the "Tapered Issuance Burn" on Aug. 4, days before Hegota's deadline for non-headliner EIPs.

Under the EIP, the share of rewards burned would climb with the total level of staked ETH and would reach 100% at about 60.25 million ETH, or roughly half of the supply. The change would phase in over about 18 months.

About 34% of ETH supply was staked in mid-August, The Block reported at the time. At that level, annual consensus yield would fall from about 2.6% to 1.2% under the proposal.

Industry reaction

SharpLink CEO Joseph Chalom formally opposed the proposal in August, saying it would "undermine DeFi." Aave founder Stani Kulechov called it "hurtful for Ethereum" at the time.

On Thursday, Kulechov quote-posted de Tychey's announcement of the withdrawal, saying "Great move."

Developers are still scoping Hegota, an upcoming Ethereum hard fork, which will follow the next update, Glamsterdam. On Sunday, Ethereum co-founder Vitalik Buterin outlined his vision for the future of Ethereum in a blog post, and said Hegota "is likely to be Ethereum's last 'normal' fork, with features and technology that would be recognizable to someone in 2015."

"Everything after that involves recursive STARKs, automated formal verification, highly optimized consensus algorithms, and making it all quantum-safe," Buterin wrote.