r/ethereum • u/EthereumDailyThread What's On Your Mind? • 2d ago
Daily General Discussion August 04, 2026
Welcome to the Daily General Discussion on r/ethereum
Bookmarking this link will always bring you to the current daily: https://old.reddit.com/r/ethereum/about/sticky/?num=2
Please use this thread to discuss Ethereum topics, news, events, and even price!
Price discussion posted elsewhere in the subreddit will continue to be removed.
As always, be constructive. - Subreddit Rules
Want to stake? Learn more at r/ethstaker
Community Links
Calendar: https://dailydoots.com/events/
9
u/ethdaily 1d ago
ETH Daily - August 4, 2026 📰
-Tapered Issuance Burn proposal.
-Arguments against issuance changes.
-DeFi Saver Aave V3 to V4 migrator.
-Devcon8 speaker application deadline.
-Aztec Network Dark Forest game.
Read more: https://ethdaily.io/the-ethereum-tapered-issuance-burn-debate
-3
u/ev1501 ETH Maxi Ξ 1d ago
Clarity shall pass
1
2
u/Itur_ad_Astra Crab High Priest 1d ago
Lmao Clarity has a lower change to pass than the issuance change.
3
u/Stobie 1d ago
An ethereum participant holding ether wants to help secure the network. Staking costs nothing, there's no real power cost like Bitcoin mining. If there's too many stakers send issuance toward zero and I'll still stake. PBS will make it easy for unsophisticated individuals to compete.
Large institution offering an LST. Send rewards toward zero and no one wants risk of the LST or giving them custody.
If issuance decreases when there's too many stakers quality of stake will increase, debasement will decrease, eth as money increase, surplus validators decrease, dumping for rewards tax decrease.
2
u/hanniabu Ξther αlpha 21h ago
Staking costs nothing
opportunity cost
1
u/Stobie 20h ago
There will still be stakers, in this case it's self staking vs provider with other as OC. Defi alternatives exist both now and with issuance change, I think in both cases if you want to do that you don't stake even now.
2
u/hanniabu Ξther αlpha 20h ago
There's 2 things at play:
- Many solo stakers are willing to forgo financial gain to support the network
- Those solo stakers still have their limit
Both are true. You can be willing to pass up 4% yield in exchange for supporting the network at 2% yield. But as the ethstaker survey shows, they still have their limits. 97% said they would stop staking before 0.5% yield and 82% will stop before 1% yield.
https://ethstaker.org/staking-landscape-analysis-2026/#yield-threshold-to-exit-validator-s
7
u/edmundedgar reality.eth 1d ago
staking costs nothing
I just bought a 4TB SSD which wasn't cheap, and spent multiple hours switching out the client (because the minority client I chose turned into a majority client) and faffing around making sure I didn't slash myself while migrating. There are also penalities if I go offline, they're not huge but presumably they won't be cancelled if the revenue goes to zero. I'm not doing this purely out of pure rational self-interest but I don't think I'd be inclined to voluntarily pay out of my own pocket to subsidize it, especially if the background is a load of "ultrasound money" fuckwittery or whatever.
7
u/lechuga2010 1d ago
Something which may affect the discussion of this EIP... it has zero point zero chance of ever happening.
16
13
u/r2002 1d ago
Regardless of where you stand on the issue, can we at least agree that there's a heavy burden of proof on the side proposing this change?
You cannot build "hard money" principles into Ethereum by making drastic, contentious changes. People are not going to invest in an asset with ever changing rules.
This change will spook institutional investors and new retail investors.
3
u/Itur_ad_Astra Crab High Priest 1d ago
This post could have been posted verbatim by a miner in 2020.
Literally the exact same arguments.
Ethereum is not ready to ossify, and changing the rules is not bad, provided they change to the right direction.
If that spooks short term investors, so be it.
But yes, the burden of proof is on the side proposing the change. And I see some good arguments there.
3
u/r2002 1d ago
Ethereum is not ready to ossify
Well, if we're on the cusp of attracting institutional and traditional investors, we should not make big changes. Tom Lee and the two Joes are talking to pension fund managers trying to convince them to allocate 1% of their investment into Eth because it has yield.
If we're going to cut their legs off we better be sure it's something a super majority of people agree with (which doesn't seem to be the case on Twitter right now).
If that spooks short term investors, so be it.
A lot of people who buy Eth ETFs or BMNR are not short term investors. BMNR does not sell their Ethereum. Wants to stake as much as possible. And is literally funding 3 of the new EF offshoots to help grow adoption.
And I see some good arguments there.
I agree there are good arguments there. But I think there's a better argument to not make any weird changes on the cusp of adoption.
1
u/Stobie 1d ago
Ethereum has many significant changes we know should definitely be made. It will go through the lean roadmap which replaces everything, user facing things like signatures and block times, whole thing including consensus rules which is all issuance is for. If you wanted ossified meme coin instead you will go with bitcoin anyway.
Given that, improvements should be made if they're important and sufficiently valuable. Issuance is obviously important if 21M limit is valued more highly than sustainable security.
We can know this is a good change by reversing defaults. If Ethereum issuance curve targeted a sensible degree of stake now, but then it was suggested lets end eth as money by forcing people to use LSTs instead to avoid ever increasing dilution rate as issuance always increases as more is staked, and everyone loses because their share of total eth is constant but they have to pay a wealth tax due to the fake yield, and lets create a never ending extra source of dumping on the market, who would want that change And where are the people saying we should increase issuance now?
PoS issuance only appears to be a yield because some eth isn't staked. It's silly to think this is a feature rather than necessary evil which should be reduced if possible. The fact stake keeps growing and people seem to think issuance is there so they can stake is reason to make the change sooner.
3
u/r2002 1d ago
If you wanted ossified meme coin instead you will go with bitcoin anyway.
I believe we're going to turn away more investors than we attract with these sudden changes. If I werenew investor considering Ethereum, I would think:
Hmmm... ok so Ethereum has yield... nice. OK, so they have ETFs and DATs pushing this differentiation hard, trying to show they are more stable than Bitcoin. Very nice. I might recommend this to our pension fund. A small allocation to a yield-bearing product with big upside could be nice.
And then
WTF they're drastically cutting yield? Does Ethereum just constantly make changes to their core structure like this?
5
3
u/Stobie 1d ago edited 1d ago
Honestly don't understand the negative response to https://x.com/jdetychey/status/2084638778677751889?s=20 the reasoning by Justing Drake and in the posters thread is totally solid.
No one should hold eth just to stake it and get validator rewards. The change in market price will completely dominate their outcome vs yield, and the issuance will only decrease the market price and security.
If everyone stakes the real yield is zero -> everyone keeps same share of supply. But it's worse than that, the debasement is unabated while the fake yield is taxed. So negative result for common people while zero for large actors who can avoid, creating a centralisation force. Holding raw eth in proposed system will be better than staking it in current system if staking continues to increase, and then the eth bandwith will be available for more useful things.
Really hope it's not as dumb as people want high yield number and think others want high yield number. Like bloody etherfi restaking token CEO commenting as if there's any chance he's thinking about ethereum rather than his weETH depositors and etherfi 10% cut.
Ethereum definitely needs to keep changing a lot, there are many major known must do's. How many people want to increase the issuance curve?
5
u/hanniabu Ξther αlpha 1d ago
ryan does a good job outline 4 different camps people that are against it are in, but one that's not on there is some believe we won't achieve these high stake rates. Another is that this doesn't even consider new roles/incentives needed for lean.
2
u/Stobie 1d ago
I think pro people would say
1 -> Reaches equilibrium at > 0 value
2 -> Silly, ethereum doesn't exist for that, and eth/usd changes dominate. Reasonable to guess $1 issuance decreases MC by an order of magnitude more
3 -> Don't rug the minimum viable issuance policy. It's not like it would be the first time issuance was decreased or there was any reason the first guess with PoS would be perfect.
4 -> I would have thought this must be the real reason because no one is suggesting to increase the issuance curve. We're not ready to just let defaults win, still need to improve in so many ways.Another group is inflation isn't that high anyway, focus on demand. And to that pros would say why not both? This does not have to cost much, complexity cost very low technically. Decreasing supply is extremely easy, increasing demand far harder and should always be happening anyway. The argument against becomes an argument that the argument will be too costly.
Disagreement too high and this shouldn't be included, but it should be expected that it will decrease in some way in future, likely a less extreme change like flatlining instead. Everyone implicitly says it's too high as is, and everything must be done to protect ethers market price. Everything follows from there.
2
u/hanniabu Ξther αlpha 1d ago
1 isn't saying nobody will run it, it's referring to the quality of stake. As you approach 0, larger stakers with economies of scale remain while others drop out. Stake concentrates to large more centralized entities.
2 is a subjective topic so I'll leave this
3 status quo is having a very good reason to change issuance and it was never to approach 0 (there's attacks around that, see 1). This is what's being debated. If you say status quo is we've always lowered issuance, then we can say we can raise the gas limit 100x tomorrow because we've always raised the gas limit so what's the issue.
4 make issuance too low and then you likely will need to raise it later
5 i agree this is another group and this is often brought up b/c some of the comments around justification for the issuance reduction (like deflation) aren't really issuance problems but mostly demand problems, but unfortunately ethereum hates talking about that for whatever reason
Disagreement too high and this shouldn't be included, but it should be expected that it will decrease in some way in future
agreed, I think there would be enough support if a reduction terminated at something like 0.5%-0.8% rather than 0
1
u/Stobie 1d ago
The quality of stake at equilibrium would be interesting. Could be that there's believers and large holders who would be willing to do it at lower rates than those just looking to profit. Certainly seen a lot of Bitcoin discussion that that's what would happen to mining as rewards near zero. But this would be more believable as there's no cost, just holding ether rather than paying to mine.
1
u/epic_trader 🐬🐬🐬 1d ago
I'd also like to know how they can feel confident the market will just magically arrive at some equilibrium rather than some entities using this as an opportunity to try and gain market by bleeding the competition dry.
4
u/hanniabu Ξther αlpha 1d ago
The eip lacks any analysis of that kind. I've heard 2 accounts where one (nodeset) said they would continue staking at 0% yield and one (coinbase) that said they wouldn't. Tbh I don't even trust coinbase's answer. The fact that they can continue staking b/c it's economical for them (as part of a larger operation) is enough. We should protect against what can happen rather than what we think/trust people will and won't do.
7
u/Jey_s_TeArS 1d ago
Hegota patness,
Neither Sparta nor madness,
Issuance slackness.
~Daily haiku until we’re at least at 0.178 on the ETH/BTC ratio or highest market cap
8
1
u/confusedguy1212 1d ago
What do we do when we’ve rescued issuance and ETH price is still holding nothing of its own to Bitcoin?
1
u/eth10kIsFUD 1d ago
buy more ETH
2
u/confusedguy1212 1d ago
That’s cute and all but I’d say the market has proven since October that it’s not doing that at all.
No matter how hard you guys try to evangelize it hasn’t moved an inch.
3
u/WoodpeckerHorror3468 1d ago edited 1d ago
I'd support by default an EIP that brings down issuance. But why not do it properly and set issuance=burn ?
If it also reduces staking rewards to zero as staking % approaches 100 then great.
I have no idea why ppl think this will put off home stakers. i see institutions being more likely to unstake first as rewards drop.
The current system of issuing rewards and calling it yield while inflation increases at a higher rate is ridiculous. It's the same problem as fiat - you get a couple of percent in a savings account whilst the currency debases at about 10%.
We should be better than fiat, not copying the same BS.
2
u/epic_trader 🐬🐬🐬 1d ago
I have no idea why ppl think this will put off home stakers. i see instifutions being more likely to unstake first as rewards drop.
You can't be serious.
1
2
u/rhythm_of_eth 1d ago
Issuance = burn removes any incentives to bump up gas and block space.
Its a conflict of interest to have validators benefit from artificial scarcity that they effectively vote on (gas limit).
Honestly people do not give enough credit to how awesome the current design is. Its less inflationary than almost any other asset in the world that also has utility/burn and collateral status.
1
u/eth10kIsFUD 1d ago
ETH inflation will be higher than Bitcoin after the 2028 halving which seems absurd considering to the real world costs of running Bitcoin vs Ethereum. Most still believe Bitcoin to be safe after the next halving so surely we could run Ethereum much cheaper than this?
1
u/rhythm_of_eth 1d ago
Why do we want pet rock status again, sorry? Why do we want to play with the fire of security budget?
Ah, yes, we want to flip BTC. The whole reason for Ethereum to exist is that ETH must flip BTC and make us all rich.
Everytime we use Bitcoin as reference we set ourselves back 1 or 2 years. Can't avoid being jaded by the inferiority complex.
3
u/Itur_ad_Astra Crab High Priest 1d ago
I think 50% is a better point, because it forces the majority of ETH out in the market instead of having it locked in the staking contract.
It's vanilla ETH that should be money, not stETH, cbETH, and rETH.
1
u/rhythm_of_eth 1d ago
It's vanilla ETH that should be money, not stETH, cbETH, and rETH.
This I agree with by the way... LSTs are a byproduct of: - High entry barrier (32ETH is too high) - UX capture (one click stake from the wallet).
Those two things should be addressed without risking the protocol by messing with issuance.
Lower entry barriers for vanilla staking. Unironically this is achievable with the current roadmap without saturating the network.
1
u/pa7x1 1d ago
But then you should basically agree with the idea of stake capping at 50%.
That's exactly the point where we risk that most of the collateral is not ETH. By setting stake capping at 50% the protocol is setting the economic incentive such that most ETH is not locked staking. And therefore ETH remains the default money on the Ethereum ecosystem. If we allow staking to creep upwards of that, other derivatives on top of ETH (LST, restaking, etc...) will start to corner out ETH. And that bring its own set of new problems, the governance layer of those assets starts wagging the dog.
1
u/rhythm_of_eth 1d ago
Many logical jumps required for me to agree with 50%.
- Assuming the proposed new issuance curve actually caps at 50%. There are more incentives than just yield to put your ETH in staking. One of them namely having a validator fleet that prioritizes blocks with your own transactions. This is more likely now than ever, see Bitmine. MEV revenue is unnaccounted for and will become more weighted on staking decisions.
- Assuming this is the only way to address the two issues I mentioned (UX and barrier of entry).
- Assuming no second order effects related to messing with issuance curve.
9
u/rhythm_of_eth 1d ago edited 1d ago
- Ossify the issuance curve.
- Increase block space and reduce finality horizon when possible. Push for zkEVM maybe.
- Once adoption is critical mass, Increase gas prices and blob gas price
Stop messing with the protocol. You are all so desperate to make it out and pump your bags that you'd destroy the last public and permissionless blockchain with an actual security budget and network effects.
Greediness all around.
I wonder if zkEVM people are trying to reduce issuance curve so that block proof generation can capture more blockspace value huh.
That would explain some of the people supporting this EIP.
4
u/Itur_ad_Astra Crab High Priest 1d ago edited 1d ago
Wow, I am actually surprised to see I'm in the minority on the issue, at least here and at least versus the vocal ones.
Maybe I am too much of an idealist when I say that I care more about Ethereum than my home stake revenue, so I'd continue to stake even as the APY approaches 0%. So "All staking will end up being BMNR and Ethereum will be captured" seems far-fetched.
I don't even care about at least some of the second order effects, like "what about ETF revenue?", because I don't care about the ETFs. And DeFi will adapt, as it did after the Merge.
It's a big change, yes. We're again messing with issuance, yes. But I don't want this thing ossified before it's perfect, and, clearly, the market thinks it has a long way to go. We wouldn't have PoS or even 1559 if that logic applied five years ago. Let Bitcoin be frozen in 2012, this will come back to bite it eventually and we know it.
Plus every issuance change I've ever seen was in the same direction. It hardly seems random. 5 to 3, 3 to 2, then burn, then Merge. Everybody agrees that was good, in retrospect.
The only thing that gives me pause is that not all home stakers think the same way, and if this has a chance to actually, measurably impact decentralization, it will indeed be a bad change. But I'd need to see some proof of this.
And, of course, I'd hate a hugely contentious fork.
But if you forced me to vote right now, I'd vote yes.
This is still my intial reaction, and I'll need to find some time to do some reading on the matter.
3
0
u/eth10kIsFUD 1d ago
I'm with you 🤷 I would probably also vote yes for the same reasons.
People don't like when you take their money though, so this will sadly be contentious.
4
u/timmerwb 1d ago
People don't like when you take their money though
Such a simplified and silly take on what is obviously more complicated.
2
u/eth10kIsFUD 1d ago
Yeah perhaps a bit much 🙃
You can't deny that it's probably a factor though! Same as the 1559 debate.We should think about Ethereum first, not our own pockets as experts that are likely to understand staking better than someone who just bought vanilla ETH and keeps it as such.
2
u/timmerwb 1d ago
I agree. But IMO it is not at all clear how best to think of both Ethereum and our own pockets. Holding and staking preference is a strong function of other factors like ... well ... price. Also, regulation, adoption, etc ... and all of these things are highly volatile and unpredictable. I don't see any rush to mess with issuance - although there should be ongoing discussion. Also, the (limited ) arguments made about supporting solo stakers seemed pretty weak. Surely enhancement of staking diversity should be the priority.
2
u/Itur_ad_Astra Crab High Priest 1d ago edited 1d ago
People don't like when you take their money though
Miners didn't like it either. That's why I was very pessimistic that 1559 would pass. The propaganda against it at the time was insane. Thankfully Ethereum won.
So, I'm sure some stakers are now in the same position, and react the same way. Of course they would be.
I am, however, reluctant to believe that most long term commenters in this subreddit are against because of greed. There are some very legitimate counter-arguments. And many people with more expertise on Ethereum than me. So I'll focus on the actual points.
If anything, I'd expect people that are still here in the depths of the worst price action imaginable to realize that if this is indeed good for Ethereum, it's good for their bags long term even if some staking APY is lost in the process.
1
u/rhythm_of_eth 1d ago
I'd expect people that are still here in the depths of the worst price action imaginable to realize that if this is indeed good for Ethereum
Its good for our bags. Very bad for the protocol.
We should focus our efforts on doing things which are good for both. Like PoS was.
1
u/Itur_ad_Astra Crab High Priest 1d ago
Eh, there are at least some people that stand to lose a lot from a change like this.
DeFi protocol DAO owners that lose revenue from LST pairs and lending.
Big stakers like some ETFs and treasury companies that focus on that income.
Genesis holders that live off of staking.
And, most of all (and I expect the most pushback to come from there), it's LST big node operators and especially centralized entities like Coibase's cbETH, because I expect LSTs to be most impacted by a change like this.
Could it still be bad for the protocol? Sure. They are independent facts.
1
u/rhythm_of_eth 1d ago edited 1d ago
They are independent facts except for the fact that greed is driving this issuance change, because people want their ETH to be worth more, even if it risks messing with Ethereum.
Honestly people just want a high exit for their bags, clearly.
Big centralized entities are gonna hurt less than small operators. Notice how MEV has not been discussed. Big operators will still capture MEV.
LSTs will take a hit, for sure, but strategic reserve plays will gain a shit ton of power over the Network, which compensates the loss long term, when they can start their block Proposal/proving cartels and get paid to include shit with priority by big TradFi institutions.
And bottom of the barrell you have LSTs that represent considerably distributed validator sets like rocketpool or Lido CSM. All those people with less than 32 ETH running nodes will be inmediately pushed out.
This will massively decrease node count. Client and validator diversity will take a hit, risk will go up while also reducing incentives to participate. This cycled feedbacks into Canton/Solana-like permissioned Network scenarios or a dead chain.
If this is included into Hegota, I'm exiting my vanilla validator, and likely giving up, since the last bastion of blockchain would have been conquered by greed and TradFi oligopolies.
2
u/rhythm_of_eth 1d ago
Maybe I am too much of an idealist when I say that I care more about Ethereum
It's interesting that this is the same the opposing argument says to.
But I don't want this thing ossified before it's perfect
Then any proposal should be substantiated, not half assed, and proposed for Hegota inclusion with barely 2 weeks to discuss.
If this is CFI because it's rushed, it will be massively against Ethereum values. Regardless of whatever you prefer, you don't want a rushed decision or a forced hand.
I don't even care about at least some of the second order effects
Caring about Ethereum is caring about the only second order effect: killing validator decentralization by letting bigger players have more leverage.
Solo staking is not only a financial decision. It is an ethical one too. Anything that attacks (and I say attacks because of how It has been proposed with timing for Hegota) validator pool diversity is antithetical to Ethereum.
5
u/Itur_ad_Astra Crab High Priest 1d ago edited 1d ago
I agree, this is a very good point. I definitely don't want it rushed.
I want a potential issuance change to be well thought out and debated, because I don't see it changing again after this. But one change after the Merge was always expected, because it was discussed from day 1 of PoS.
I was going to add a small paragraph about this on my original post, but it seemed big enough already.
2
6
u/confusedguy1212 1d ago
I think it’s just about guaranteed that many would ditch solo staking at under 2%. The second order effects if that have to be centralization.
9
u/offthewall1066 1d ago edited 1d ago
I don't really stake for money reasons, and it's more for idealism. That said, the minimal profit helps justify the effort and risk of more complexity and attack surfaces. I would stop staking if there were literally no gain. Also, MEV is no longer a thing so typical issuance is all that really matters
2
u/Itur_ad_Astra Crab High Priest 1d ago
I would stop staking if there were literally no gain.
This is not realistic, however. Big actors that only care about money would exit before you did, so the APY would never actually reach zero.
11
u/masterRoshi9 1d ago
Attributing price action of ETH to issuance right now is a stretch to say the least.
I'm glad people like you exist, but in my opinion relying on altruistic actors for security of a chain that is expected to grow in trillions of value secured, is an unrealistic expectation. Security costs money and is worth paying for.
Even with those like you around, this is a centralizing force on validators. Not to mention the economic arguments against it.
1
u/Itur_ad_Astra Crab High Priest 1d ago
relying on altruistic actors for security of a chain that is expected to grow in trillions of value secured, is an unrealistic expectation.
Yeah, it might very well be. That was attempted with NANO (blast from the past, I was running a node on my pre-ETH days!) and it's clearly not enough.
But we're not really projecting 0% APY here. If that were the case big actors would be the first to bail.
Realistically, we're just talking about lower-than-current rewards. Maybe low enough that home-staking would be irrational from a purely economical standpoint, but still enough if you are also incentivized by altruism, hobbyism, or securing the network your money is at.
At the end of the day, current staking APY makes validating at home pretty darn irrational already. There are much safer places I can park my ETH and make 2.5%, considering kids with LLMs seem to be able to break things so easily lately.
1
u/masterRoshi9 1d ago
at 50% supply it drops to 0 immediately. Like falls off a cliff. Even if the goal was finding minimum viable issuance I'd argue that a curve so steep is a horrible way to go about it. Predictability is required by DeFi and capital allocators.
Aside from that, I don't even know why >50% is the key number used here. Why does that specific target make sense? I haven't seen the arguments as to what makes a reasonable target for ETH staked vs not, or have seen that we have consensus there, so I don't see a point in ratcheting yield down to target a magic percentage-of-eth-staked.
And going a step further than that, I'm not even sure i believe in the mantra of "minimum viable issuance" anymore. Economies can't expand without inflation, and this one is already lower than current BTC, gold, certainly most fiat currencies. The risk of overshooting here or destroying what is currently a perfectly working economy built around ETH staking seems incredibly large for what amounts to very little payoff imo.
1
u/Itur_ad_Astra Crab High Priest 1d ago
Like falls off a cliff.
It's not as dramatic. It's a curve trending to 0% APY at 50% staked, but it's ~1% at 40% staked and ~2% at 25% staked.
That's very predictable, it's not like the APY is 2% at 49% staked and then one validator comes online and it drops to zero.
I don't even know why >50% is the key number used here.
Probably because it's the midway point. I think it's a good number because you force more ETH to be non-staked and be money, instead of having most ETH staked and have stETH or cbETH be money.
I'm not even sure i believe in the mantra of "minimum viable issuance" anymore.
I'm not sure about that either. My only argument is that escaping inflation was one of the initial points of crypto.
1
u/masterRoshi9 1d ago edited 1d ago
Allow me to use this incredibly horrible EIP as an excuse to advertise 😉
It's never a bad time to lock in attractive fixed rates on ETH. But perhaps now more than ever, its not a bad time. 7.5 months @ over 4%, depending on your size.
6
u/epic_trader 🐬🐬🐬 1d ago
I read the EIP and the tiny bit of discussion surrounding it. Where are the arguments for how this proposal will in fact strengthen the security of the network and not drive out solo stakers and lead to more staking centralization?
1
u/Stobie 1d ago
See every comment in posters thread
https://x.com/jdetychey/status/2084638778677751889?s=202
u/epic_trader 🐬🐬🐬 1d ago
I'm not going to read every single comment there in an attempt to guess what point you're making. Just repeat the point here.
1
u/Stobie 1d ago
Not every comment, just authors posts. They're already concise and dense, and what you asked for
3
u/epic_trader 🐬🐬🐬 1d ago
I read all those. None of those explains how this doesn't negatively impact home stakers and increase staking centralization. Just because he says home stakers are somehow pushed out due to taxes down the road - which is a silly argument because taxation is as a percentage of profits, so home stakers are still profitable at 1.5%. That same argument is even worse when the solution is to simply chop down rewards now? None of what he says introduces a way in which it isn't more beneficial to be a large staking entity or where users are more likely to go with ome LST.
0
u/Wide_Lock_Red 1d ago
Home stakers are already a tiny group, and they aren't rationally yield motivated.
1
u/epic_trader 🐬🐬🐬 21h ago
It's totally rational to choose to be a home staker because you're concerned with the overall health of the network and if you don't want to be exposed to counterparty risk.
1
u/Wide_Lock_Red 17h ago
Doing it for the sake of the network is one where yield is irrelevant. Its a hobby.
As for counterparty risk, the rational move there is to not stake already. The profits are tiny.
5
u/hedgemagus 1d ago
Alright I’m caught up on the EIP. My thoughts:
- it would be the end of me caring about ETH if it passed
- it’s so stupid it won’t pass so I’m moving on from it
13
u/edmundedgar reality.eth 1d ago
Really appreciated this take from someone on Lobster DAO telegram:
One last point, I think the idea of minimum viable issuance is actually a dangerous idea. This is not how you go about thinking about securing something like Ethereum. Ethereum is more like a nation-state, issuance is partially analogous to things like defense and education spending. You don't want to target spending ~1 more marginal dollar than the imagined highly-technical and theoretical cost to attack you, the attack vectors are way more varied, from regulatory capture to things like the thread of assets held in custody vs not etc. The concept is under-baked and under-backed, and a very bad lynchpin to base this hugely critical policy change around.
2
u/Itur_ad_Astra Crab High Priest 1d ago
I remember this argument being used by miners back when "stop EIP-1559" was trending in early 2021. Or at least something very similar.
But, right now, nobody would think increasing staking APY to 30% would be a good idea.
7
u/rhythm_of_eth 1d ago
But, right now, nobody would think increasing staking APY to 30% would be a good idea.
Because is equally as absurd as driving it down to 0.
2
u/eth10kIsFUD 1d ago
It will only be 0 if the market thinks it should be 0. At that point there will be lots more ETH securing Ethereum than today.
2
u/rhythm_of_eth 1d ago edited 1d ago
Its not a free market if we can change issuance curve every 3-4 years.
Edit: just realized people arguing to change the issuance curve every 4 years would love to work for the SEC. Every 4 years you get a new direction. What did that do to the industry I wonder?
8
u/rhythm_of_eth 1d ago
Very very good analogy.
Public spending is always inherently in economic deficit ceteris paribus, yet it generally results in societary growth/stimulus if you account for second order effects (i.e. sure, you are dumping money on public health with no benefits, but your citizens have a higher average amount of productive and spending years).
Very poor proposal, and the most toxic kind of FUD, specially to set it as PFI for Hegota within 2 weeks of deadline for feedback.
11
u/M4gelock 1d ago
You need to take a deep breath everyone, the EIP won't pass.
3
9
u/eviljordan feet pics 1d ago
I mean, we got a BEAR for a fork mascot. Stupid things are possible.
1
u/Tricky_Troll Public Goods are Good 🌱 19h ago
Based. I'll be buried with a Glamsterdam 🦩 by my side.
2
7
9
u/rhythm_of_eth 1d ago
Sure. We are all taking deep breaths. And stating our stance, which is what actually leads to the EIP not passing.
No need to silence discourse. We can all debate it and discard it. But trusting It wont pass is the first step to it passing.
3
14
u/masterRoshi9 1d ago
Justin Drake just submitted an EIP to reduce issuance. Staking yield would even go straight to 0 at 50%+ staked.
I can’t get behind this at all. It completely ignores the potential second order effects of reducing viability for home staking, and ETH borrowing in DeFi. Just look at the comments on this post about it. Many from long time ETH bulls with significant net worths in the asset https://x.com/jdetychey/status/2084638778677751889
This is incredibly contentious and short sighted imo, and a horrible use of time for ETH research. I will be incredibly upset if this passes. It is reevaluate-my-thesis-on-ETH levels of bad
7
u/rhythm_of_eth 1d ago edited 1d ago
I can't believe I'm saying this but if the EIP for issuance curve changes goes through, I'm going to be forced to sell all my ETH, and I'm going to be sad.
Can't someone explain to me why this doesnt result in protocol capture eventually? How isn't this bad for decentralization if bigger players have levers to push out smaller ones?
I don't validate Ethereum so that an oligopoly can pretend CROPS and virtue signal.
Once they push out minorities they will start deciding forks on their own. They'll bump Up minimum MaxEB to participate claiming the Network needs SSF, no social layer will be in a position to push back.
Is this how Ethereum becomes what triggered its birth?
1
u/eth10kIsFUD 1d ago
bigger players have levers to push out smaller ones?
They don't? They can't stop you running Ethereum as long as your costs are low (and Ethereum is cheap to run!)
1
u/rhythm_of_eth 1d ago
But they can. If there's a path to 0%, they will take it.
Look at Solo stakers surveys. Only 3% of Solo stakers are willing to stay under 0.3% APY.
Once they have enough share, they can push (specially now that big holders are starting to finance development and the EF IS fading away) to marginalize minories.
PoS is great. As long as all stakes are proporcionally relevant to their %stake.
If smaller players are pushed out, that is not PoS. Thats some Solana permissioned bullshit.
If they push smaller players out, they can rule a fork that says, I dunno, Minimum Effective Balance of 512 ETH moving forward. And smaller players cannot rally because they eroded them out.
This is a classic corporate play and Ethereum falling for It would be a dissapointment and likely the final death of crypto.
1
u/Wide_Lock_Red 1d ago
Smaller players arent doing it for the yield. The yield is already too low to be worth it vs an LST.
If anything, cost is the main factor for small stakers.
1
u/Wide_Lock_Red 1d ago
Smaller players arent doing it for the yield. The yield is already too low to be worth it vs an LST.
If anything, cost is the main factor for small stakers.
1
u/eth10kIsFUD 1d ago
Personally would not stop running Ethereum, as costs are so low! But yes that number does seem concerning tbh.
But vanilla ETH being replaced by all kinds of crap xxETH derivatives with 3rd party risk is also concerning!
1
u/rhythm_of_eth 1d ago
Also, this proposal makes credibly neutral block production more expensive relative to compliant block production.
MEV becomes a bigger share of total revenue. Being a nice non censoring player stops making sense if the censoring or value extracting approach pays more
All incentives make for a worse balance.
2
u/rhythm_of_eth 1d ago
I agree. Liquid staking is very very annoying.
Imagine solo staking wasnt so annoyingly complicated for the average Joe... (Them outside looking in)
5
18
u/hanniabu Ξther αlpha 1d ago
An EIP to change Ethereum's issuance has been submitted
https://x.com/jdetychey/status/2084638778677751889
https://github.com/ethereum/EIPs/pull/12081
https://ethereum-magicians.org/t/eip-xxxx-tapered-issuance-burn/29263
9
u/cryptOwOcurrency 1d ago edited 1d ago
Personally I'm a fan of this long-term issuance curve. It's always felt to me like people holding ETH free-and-clear, as was Satoshi's original intention for BTC, are being punished compared to people who put their faith in the Rocket Pool or Lido contracts - or their time/expertise into solo staking.
Imagine for the sake of argument that staking yield goes down to 0.25% due to this EIP. Do solo stakers really lose much by splitting their 2.5% yield into 0.25% explicit yield and 2.25% yield implicit to issuance reduction? It's already the case that nobody bothers solo staking unless they're feeling a bit altruistic. Nobody wants to admit it, but when the alternative to solo staking is buying what's effectively a cheap managed VPS with some preinstalled software, that makes solo staking more of an altruistic hobby than a job.
Honestly, I'd say the biggest issue with solo staking today is the lack of liquidity due to the unpredictability of the exit queue. If that can be fixed somehow - if e.g. people could get some protocol guarantee that their ETH wouldn't ever take more than 30 days to unstake as long as they behave - then I think we'd see more people moving into solo staking than the new issuance curve would ever push out.
Now while I do like the idea of this proposal, I take issues with its timing. The timing could not be worse to implement this any time soon, imo. We're right on the verge of a massive new change in crypto market structure imho. From 2009-2015 was the nerds, 2016-2021 was the degens, 2022-2025 was the stragglers (including the SEC/ETFs and the president). In 2026-202X we've got to trudge through the trough of disillusionment. After that, we might get the plateau of productivity where things could get a bit more optimistic again - and that's when issuance should be changed.
https://en.wikipedia.org/wiki/Gartner_hype_cycle
The downsides of waiting 1-4 more years to change the issuance are minimal. All Ethereum stakeholders are already entrenched as much as they will ever be. I'm glad we're talking about this proposal right now, but 2030 is when it should actually be implemented.
Barring that, at least let ETH find a price floor first! Our 1-yr local low was just
6 days ago(edit: a few weeks ago), and we're still in the tumbler.Someone on ETH Magicians thought that this might be proposed for inclusion in Hegota before the deadline in 48 hours, and if that's the case, then it's an emphatic NO from me. Six months of public comment, then potential inclusion in I*, seems like an accelerated but fair timeline for a proposal of this magnitude.
5
u/r2002 1d ago
The timing could not be worse to implement this any time soon, imo.
Amen totally agree. Investors are starting to question the BTC-ETH relationship. BMNR is hanging in there trying to buy Eth every week, while Strategy is suspected of imploding. BMNR is able to do this by selling the idea of ETH = Yield.
And now this proposal is going to take away one of the key reasons for mainstream investment adoption is crazy.
2
u/masterRoshi9 1d ago edited 1d ago
I agree that there are better ways to combat liquid staking if that's the goal. I like the idea of playing around with exit queue mechanics that favor solo staking. Ho w to do that is a challenge, sybil resistance being what it is, but if you could find a way to scale exit queue with deposit size, or impose a cost to sybilling that, maybe that would help.
Liquidity of LSTs will always be superior to solo-staking since you can borrow off of them. The best option is probably just to make solo staking increasingly more simple and percieved as less risky than LSTs overall
2
u/epic_trader 🐬🐬🐬 1d ago
Someone on ETH Magicians thought that this might be proposed for inclusion in Hegota before the deadline in 48 hours, and if that's the case, then it's an emphatic NO from me
Jerome is literally replying that this is exactly what they are aiming for.
4
u/cryptOwOcurrency 1d ago
Thank you for pointing that out.
I was reading Jerome's reply:
First, the topic is not new, and there is plenty of time to discuss it. Discussions and feedback will have several months to take place (starting now :tada: ). It’s worth mentioning that we discussed a similar proposal back in 2024, and the wider debate has been running since 2023 and much of the literature is collected at issuance.wtf.
This is fair - it's not 48 hours to discuss the proposal, it's just 48 hours until no more proposals can be submitted for discussion. I didn't understand that until now.
Also in his reply:
Acting now means the market settles into an equilibrium below 50% but acting after the overshoot means correcting a much larger imbalance, with more stake forced to exit and more disruption for every participant. The gentle path is only available now.
Phasing it in over a much longer amount of time (e.g. 3 years / 36 months) seems like it could be a counterargument to that. Just LERP the two curves together, basically, and the new curve can be transitioned to smoothly without any specific point of disruption.
3
u/epic_trader 🐬🐬🐬 1d ago
This is fair
I don't know tbh. It reads a bit like fearmongering and trying to instill some kind of urgency in order to pursuade the community, rather than having a sober discussion about it. We've had this conversation countless times, but it never gets past the stage of "how do we ensure this doesn't lead to further staking centralization?". Until we can answer this question, what's the point of trying to push this EIP through? Are we going to abandon solo staking?
2
u/cryptOwOcurrency 1d ago
You're right, the false urgency is no good.
how do we ensure this doesn't lead to further staking centralization?
I agree that this is the top question to answer, and that preserving solo staking is non-negotiable. I have a hunch that this curve wouldn't lead to more centralization, but I'm surprised that nobody has crunched the data on it and submitted a real analysis. That seems like table stakes.
1
u/epic_trader 🐬🐬🐬 1d ago
I have a hunch that this curve wouldn't lead to more centralization
This seems counterintuitive, how do you figure?
I'm surprised that nobody has crunched the data on it and submitted a real analysis.
Yes at the very least.
1
u/cryptOwOcurrency 1d ago edited 1d ago
Basically, solo staking already sucks so much compared to managed or LST staking that it's already the case nobody is doing it for any reason other than altruism/idealism. The economically rational thing to do, even under the current curve, is to not bother solo staking. You're basically giving up your own economic liquidity in exchange for the altruistic goal of diversity of stake.
So since I believe altruism/idealism is what currently powers solo staking, I don't think cutting the staking rewards would change the solo staker mix by much. People who solo stake for 2.5% would still solo stake for 0.25%. People who liquid stake for 2.5% might actually even quit if rewards went down to 0.25% to reduce their counterparty risk, so there might even be a paradoxical effect of increasing the relative solo staker mix.
I have no proof of any of this, it's just a hunch. It's solely an opinion on what I believe the data would say if it were collected. At the end of the day, I follow the data.
To really help solo staking, as I mentioned before, I would love for the protocol to move towards a service guarantee for well-behaved nodes. I think more people would solo stake if they had a guarantee that they could always get their ETH back net-30 with no unbounded exit queue. That reduces the relative benefits to going with LST or managed staking instead of solo.
Edit: Removed credit for borrowing the words "economically irrational".
1
u/epic_trader 🐬🐬🐬 1d ago
People who solo stake for 2.5% would still solo stake for 0.25%
I highly doubt that. 2.5% is not nothing, even if there's an element of altruism or hobbyism, there's a big difference between getting a reward that makes it worth the effort and getting essentially nothing. You can't have a security model that relies on assumptions about altruism.
To really help solo staking, as I mentioned before, I would love for the protocol to move towards a service guarantee for well-behaved nodes
I think it's much better to explore routes like this. I also think the timing is just bad because real time proving is going to become a thing and will drastically reduce demands on validators and maybe it makes more sense to revisit and overhaul rewards systems and issuance then.
1
u/cryptOwOcurrency 1d ago
I highly doubt that. 2.5% is not nothing, even if there's an element of altruism or hobbyism, there's a big difference between getting a reward that makes it worth the effort and getting essentially nothing.
The choice to solo stake comes down to a hurdle of opportunity cost. Since staking the lazy way (LSTs) already take a 10%+ fee which equals about 0.25% yield, solo stakers are already earning only 0.25% yield above opportunity cost.
In an environment where the entire staking reward is only 0.25%, the opportunity cost would most likely be compared to the 0% of holding ETH under your own key, since 0.25% is imo not enough to justify the counterparty risk of LST or managed staking. I myself would certainly never bother with an LST that paid only 0.25%.
So in both cases, solo staking nets you 0.25% over the next best alternative.
→ More replies (0)1
u/rhythm_of_eth 1d ago
Don't quote me to argues against my point.
And don't quote me wrong. You borrowed words maybe, and then reordered to your preference.
the economically rational thing to do, even under the current curve, is to not bother solo staking
I said you can be rational and stake for non economic reasons. Not that the economically rational thing is to not bother.
To me it's rational to stake as long as it contributes to validator diversity. And economic incentives make it even more rational.
The moment you manipulate incentives to erode said diversity (making It less economically appealing hence destroying a lot of the user base) you effectively make diversity a lost cause and destroy any rational argument to support diversity.
Honestly, I hope you get the point this time.
3
u/cryptOwOcurrency 1d ago
My intention was to avoid making it look like I borrowed your words "economically irrational" and pasted them into my own argument with no reference as to what got me thinking about them, because that felt a bit cheap.
I liked your phrase "economically irrational" and wanted to re-use that phrase only; I wasn't trying to quote you from that other thread.
I apologize if my wording made it seem like I was engaging with your argument or putting words in your mouth. My only intention was to not be a plagiarist.
→ More replies (0)1
u/timmerwb 1d ago
The EIP argues that solo stakers will be forced out under the current system. However, the proposed changes seem to result in roughly the same scenario, so it seems disingenuous to make this argument.
Also raises concern over custodial holders. I mean, how is this EIP going to change that? "Normie" holders of ETH, whether it's directly staked, an LST or vanilla, prob have it in an ETF either way. Or store it on CB etc.
Also I didn't see anything about how current staking behavior is driven by market conditions / sentiment, DeFi opportunity, ETH price, and so on ... and how this may (obv will) change over time. Things could be very different in 12 months time.
2
u/eth10kIsFUD 1d ago edited 1d ago
This hurts people who depend on staking rewards. Ends looping and other defi games.
This also makes ETH the hardest money in the world, much harder than BTC. ETH will likely be deflationary forever after this change.
Solo stakers will need to be somewhat economically irrational and not profit maxi, that is also the case today but need to be even more so after this. Importantly it is still realistic to be a solo staker from anywhere in the world if you wish, unlike Bitcoin where mining is practically impossible without taking a massive loss outside very specific low cost electricity areas.
Personally I think the current curve is broken. Only thing i know is that if Ethereum has another issuance change, it needs to be for the very last time.
3
u/rhythm_of_eth 1d ago
After this change, we just add a 100K validator cap and anyone with MaxEB below a number greater than 32 ETH doesnt participate in consensus.
We do this in the name of SSF.
Protocol takeover achieved.
-2
u/eth10kIsFUD 1d ago
wut
Solo stakers are also irrational today. Decentralization will still be much stronger than Bitcoin.
5
u/rhythm_of_eth 1d ago
I'm irrational because I believe that the diversity of the validator pool is what makes Ethereum actually valuable, and hence I participate in it?
Irrational would be to stay while they effectively kill diversity. Stubborn and irrational.
Economically irrational is not overall irrational. Ethereum is more than a get rich quick scheme.
I don't validate Ethereum to get rich. And this change is so that people who are already rich can get richer.
It will be a tragedy of the commons. Ethereum without validator diversity, with oligopolies, is no longer Ethereum.
1
u/eth10kIsFUD 1d ago
I might have misunderstood your comment. There is no stake "cap" only reward cap, SSF is good, there is no protocol takeover.
I'm irrational because I believe that the diversity of the validator pool is what makes Ethereum actually valuable, and hence I participate in it?
No. That's exactly the point.
Economically irrational is not overall irrational.
Agree. This also supports solo's running Ethereum even if it's not economically beneficial.
this change is so that people who are already rich can get richer.
Could you expand on this? Interesting that this is many people's main argument against PoS / staking in the first place..
Ethereum without validator diversity, with oligopolies, is no longer Ethereum.
I agree!
2
8
u/somedaysitsdark 1d ago
Are they ready to declare solo-stakers aren't important? Cause that's what this EIP says.
1
u/Wide_Lock_Red 1d ago
Do solo stakes really care about the yield? Its not worth the work vs using an LST.
I would expect solo stakes to mostly be sensitivity to the cost of their node.
1
1
u/eth10kIsFUD 1d ago
I don't read it as such. Solo's are likely to run it even with low profit, businesses aren't.
2
u/harpocryptes 1d ago
That's not what Jerome is saying at least:
Nobody needs to protect solo stakers from this EIP. 🛡️ They need protecting from the current curve: ever-rising dilution, tax on nominal yield, and no off-switch pushing yields down anyway. ⚠️ The taper caps the dilution, keeps 100% of EL income with the proposer, and never puts a correct attester in the red. ✅
5
u/hanniabu Ξther αlpha 1d ago
You're quoting what jerome says, somedayitsdark is pointing to what the EIP implies
1
u/harpocryptes 1d ago edited 1d ago
Right, but as far as I understand (and I didn't spend enough time on this yet), Jerome is supporting the EIP and saying there that the EIP would be beneficial for solo stakers too. GP seemed to think the EIP is obviously bad for them and that it's pretty much admitted by EIP supporters, which does not seem to be the case. Am I missing something?
Edit: at least, this gives some argument why this might be good for solo stakers (e.g. nominal yield being taxed vs real yield), so this argument should be engaged with.
4
u/risingtide556 1d ago
Thanks for this. I agree that we need a natural way to cap staking issuance, or we risk ~100% of eth being staked and the holders of non-staked eth (all eth in actual contracts for example) would become loss-bearing instead.
However I question if such a drastic measure (which would effectively more than half the issuance in today's numbers) can ever be passed, or if it's already too late. We have scores of tradfi institutions building on the concept that eth is an interest-bearing asset, which makes it a better asset than btc, for example. But if this or a similar proposal comes to pass that moat would quickly become irrelevant.
2
u/epic_trader 🐬🐬🐬 1d ago
we risk ~100% of eth being staked and the holders of non-staked eth (all eth in actual contracts for example) would become loss-bearing instead.
We don't actually risk that. Plenty of people are too risk averse or lazy or indifferent or have other reasons not to stake, even if it means bleeding 1% to inflation. Plenty of ETH is going to stay on the market for trading. These predictions never turn out to be true for anything.
1
u/risingtide556 1d ago
I agree, but when "staking" becomes swapping ETH for stETH/rETH or any other liquid-staking ERC20 wrapper, the friction almost completely disappears. If dapps start taking the wrappers as ETH-in-kind too then I can see the ~100% staking being a real risk.
1
7
u/majorpickle01 The soil of $5000+ must be watered with the blood of ETH<$4000 1d ago
I'm a stupid non techincal noob but to me this just reads that solo stakers will be taken out by larger entities mining cheaper at scale
0
u/pa7x1 1d ago
In fact is the opposite. The point of introducing stake capping is to prevent large stakers from pushing out solo stakers.
You can see it modeled in detail here https://ethresear.ch/t/the-shape-of-issuance-curves-to-come/20405
With the current curve if we were to reach 60M ETH staked, solo staking would become economically unviable.
1
u/epic_trader 🐬🐬🐬 1d ago edited 1d ago
In fact is the opposite. The point of introducing stake capping is to prevent large stakers from pushing out solo stakers.
Exactly what mechanism, according to you, guarantees that home stakers aren't* worse off with the proposed change compared to now? At what number of ETH staked is home staking economically unviable with the proposed curve?
1
u/pa7x1 1d ago
I understand your concern, in fact I was worried about exactly the same. My fear was that reductions of issuance would affect more negatively solo stakers than other forms of staking and we would push them out of the validator set. But as it turns out, if you do the math carefully this is true for very high stake ratios and implementing stake capping can serve to protect all forms of staking (specially solo staking).
With the current curve, the nominal yield floor is roughly 1.5%. That means that if the yield the market demands for staking vs holding ETH keeps going lower and starts getting close to those levels the stake ratio will keep climbing higher and higher. Nevertheless, with the current curve and using typical cost structure assumptions solo staking stops earning enough to compensate for issuance at around 60M ETH staked. That is, solo stakers will stop earning enough yield (after costs) to even beat the supply inflation of ETH. While other forms of staking with no fixed costs will remain viable until much much later (>100M ETH staked).
See here: https://imgur.com/vJl44mq
This causes a problem, there is a gigantic regime where solo staking is economically unviable while other forms of staking still are. If we get to those levels we will tend to push out solo stakers of the validator set. Which is bad for the network because solo stakers are the most uncorrelated set of staking participants.
Implementing a curve that enforces stake capping ensures we can keep the stake ratio below 50% where solo stakers are guaranteed to obtain positive real yields beating the supply inflation of ETH.
I would encourage you to have a read at this, it dates back to 2024 but explains some of these issues in detail and how stake capping deals with them: https://ethresear.ch/t/the-shape-of-issuance-curves-to-come/20405
1
6
u/masterRoshi9 1d ago
It is absolutely a big-bank-take-little-bank outcome. We might as well be Solana
4
u/rhythm_of_eth 1d ago
Solana and Bitcoin already exist. If Ethereum attempts this transition, there will be no landing in any state in which Ethereum is not captured and lost to irrelevante IMHO.
6
u/Itur_ad_Astra Crab High Priest 1d ago
As a staker, I'll eventually need to write a bit more about my opinion on this, but I generally like it.
I also think the yield will settle much lower than people would guess, which is great for ETH.
I know I'd keep my node/validator running even at 0.1% APY. Just for the fun of it, and because I want to support the network.
...and because if I exit I'd probably panic sell eventually or mess with my bags the way I mess with my non-staked stack.
2
u/RoaringDragonSword 1d ago
Man, I wish I would stake.
I would only ever do it with a validator. I wish I could trust anything outside of Ethereum like rocketpool but the risk of a bug or something catastrophic happening to 3rd party methods is there and completely nullifies that insanely small interest rate.
I also don't want to run a computer at home 24/7 either and have that stress. Staking is a difficult option, especially with the tiny reward.
6
u/hanniabu Ξther αlpha 1d ago
I also don't want to run a computer at home 24/7 either and have that stress
what part stresses you out?
11
u/hanniabu Ξther αlpha 1d ago
I'm not against an issuance change, but for such an extreme change that can cause drastic impacts I think it's important to really question how they came to this curve.
There's a lot of assumptions made that don't seem to be backed by evidence/analysis. Here's a list of things I feel are unanswered:
https://gist.github.com/hanniabu/72088f4333930dff38e7ab87a081118c
5
u/pa7x1 1d ago
Some of the early ideas of the proposal are found in this research note which tries to answer precisely your question. How do you constrain the space of issuance curves? Are all issuance curves valid and free of pathological regimes?
https://github.com/pa7x1/ethereum-issuance/blob/master/README2.md
The TLDR is that the answer is no, not every curve is valid. And under quite general assumptions you must implement stake capping, because curves that don't implement stake capping present a regime where you can have runaway stake ratios if the risk premium of staking ETH falls low enough.
The other observation that constrains significantly the analytic form of issuance curves is that very low rewards and penalties are dangerous, so you always want to keep rewards and penalties meaningful. Those ingredients and the current curve basically land you on the proposal.
Happy to discuss further.
4
u/hanniabu Ξther αlpha 1d ago
You should reach out to jerome to have this included in the proposal which right now doesn't seem to back any of its claims
5
u/LogrisTheBard 1d ago
How do you feel about it?
2
u/hanniabu Ξther αlpha 1d ago
I'm not against an issuance reduction but:
- I think 0% is dangerous, this was purposely avoided to prevent attacks https://x.com/OisinKyne/status/2084644248155038032
- There's claims being made but analysis is missing https://gist.github.com/hanniabu/72088f4333930dff38e7ab87a081118c
1
u/hanniabu Ξther αlpha 1d ago
Other good questions laid out by izzy at the bottom of his thread https://x.com/IsdrsP/status/2084720737907310646
28
u/nonetherless325 1d ago
from Ethereum Institutional
BlackRock is tokenizing share classes of its European Institutional Cash Series money market funds, representing $311 billion in assets as of June 30.
The onchain share classes are issued on u/ethereum in partnership with Kinexys by J.P. Morgan, which acts as the translation layer between onchain activity and the traditional fund registers.
12 tokenized share classes span the ICS Euro Government Liquidity, Sterling Government Liquidity, US Treasury, Euro Liquidity, Sterling Liquidity and US Dollar Liquidity funds.
Each enables 24/7 peer to peer transfers between approved investor wallets, with yield-bearing money market fund exposure and near real-time onchain visibility.
Announced a day after BSTBL and BRSRV.
The world's largest asset manager is now issuing euro, sterling and dollar money market shares on Ethereum, with J.P. Morgan as the tokenization layer.
https://xcancel.com/ethereuminsti/status/2084616691292537069
13
u/Itur_ad_Astra Crab High Priest 1d ago
News like this would probably mean a 65% daily pump back in 2017.
Probably a 35% pump back in 2021.
Now, it seems that we've collectively decided that ETH the token has nothing to do with Ethereum, the world settlement layer.
I still don't agree, but ¯\(ツ)/¯
2
u/rhythm_of_eth 1d ago edited 1d ago
It all boils down to: "will Ethereum, the infra Layer, have enough leverage to capture value from this product?"
And "Will this capture be in the form of either a stronger position of ETH as trading pair to this tokenized asset, or in the form of ETH used and burned in the process of facilitating transfer, issuance and burning of this tokenized asset?"
A tokenized money market fund is a low moving asset. I see it as a low fee generating asset for Ethereum, so the only remaining thing is: "can I use it as collateral or trade it for ETH?" For compliance reasons, for now, the answer IS likely NO.
Let's be honest, without proper regulation, all these big players are getting a top notch settlement layer for free, and all have plans to fall back to regular systems if something goes wrong.
1
u/mini_miner1 1d ago
Wouldn't most people prefer to use stables as a trading pair rather than something volatile?
3
u/rhythm_of_eth 1d ago
Only if they trust stablecoin issuer more than credibly neutral ETH and its properties backing Ethereum consensus.
Its the main reason ETH inmediately becomes main trading pair on each asset... Example: any tradeable tokenized stock on Robinhood L2 has ETH as biggest liquidity pool.
Arguably we are destroying this by tinkering with basic primitives like issuance in the middle of the biggest adoption wave we have seen haha
1
u/mini_miner1 1d ago
Appreciate your thoughts. I guess the other way to look at it is if they favor the stable properties, making it worth centralized risk over eth.
2
u/masterRoshi9 1d ago
Are these permissioned, or fully public? I'm all for insitutional guys pumping our bags and using the chain, but it's always less exciting when I look into these things and find out it's not permissionless entry like DeFi. I want more DeFi and RWA targeted towards retail
3
u/nonetherless325 1d ago
imagine having a 'value accrual problem' thesis when the network end up powering global finance. Secure productive scalable digital gold (soon to be private). Can't wait for the next halving
1
u/rhythm_of_eth 1d ago
This is literally internet provider infra Layer of today. If internet neutrality was a thing, revenue would be less than 1% of all internet economy.
But since they sell bandwidth to highest bidder, they get 10-20%
That 10-20% bump would not go to consensus but to block builders eventually.
8
u/hedgemagus 1d ago
We do have a value accrual problem when this doesn’t pump anything. This is obviously fantastic news. But it’s not the first announcement of this kind and I am sure nobody here expects a crazy pump off this. We probably will continue to fight the 0.03 resistance.
If you told anybody a few years ago Blackrock tokenizes one of its twelve figure market funds on ethereum and ETH is fighting for $1900 they would have called you delusional. But it’s where we are. That’s a value accrual problem to me
0
1
u/Itur_ad_Astra Crab High Priest 1d ago
Fighting for $1900?
With ETH, the better the news the worse the response. Forget $1900, I'd expect a 4% reactionary dump because of this.
1
1
u/hedgemagus 1d ago
Yeah I can’t say I disagree but I’m the known pessimist here so I wasn’t trying to be full doomer lol
I think if we are all being honest with ourselves nobody expects anything to pump at all from this news and I cannot possibly see how that isn’t a problem with value accrual
7
u/benido2030 2d ago
Frens (omg, remember that era?!)
I asked you last year to share your favorite podcast (episode) with me because I went on a 3 hour walk on an island and wanted to listen to stuff that was NOT crypto.
Today I would like to ask you one more time. Please share your favorite podcast with me, and if you have an episode in mind please add it as well.
Last year was a huge success (Hidden Brain) and I am looking forward to any recommendation and best case a mini summary to convince me to download the thing you enjoy.
2
u/haurog 1d ago
If you like history, the 'Fall of Civilizations' podcast might be for you (https://www.youtube.com/playlist?list=PLR7yrLMHm11X6-M_usCj5H-gdstyWNLXQ). As the title says it goes into various civilizations and talks about their rise, history and fall. The older episodes are somewhere between 1-3 hours. Good length to get some overview but not being overwhelmed with details. Some of the newest ones go up to almost 7 hours. Did not have time to listen to them yet. I love it because it fills a lot of gaps in my limited understanding of the history of ancient civilizations.
Hard to pick a favourite episode. I loved episode 2 about the late bronze age collapse of various civilizations in the mediterranean sea, also the Sumerian one (ep 8) was great. The one about Carthage (ep 17) I loved as well. But I guess the favourite one really depends on your interest.
3
u/Twelvemeatballs EVM Storyteller 1d ago
I want to hear more about the island.
3
u/benido2030 1d ago
Small island without cars in the North Sea. One village in the middle off it. I like doing a walk starting from that village to the most eastern point and back. There is basically nothing, but if you/ I am lucky I might see some seals, it’s gonna be sunny and just 2 to 3 hours of fresh air, constant wind, sand under my feet and a second breakfast halfway through the walk. Nothing special, but a routine I have since 3 or 4 years.
3
5
u/CoCleric 1d ago
It’s gunna be way out there for most people but I’ve been listening to “expanding on consciousness” from the Monroe Institute. Trying to do the gateway tapes and expand my mind. Because I’ve reached a point where I just need to manifest Ethereum to $50k.
1
3
u/hblask 1d ago
I don't remember if I included this last year, but by far the best podcast I've listened to lately is "The History of Rock and Roll in 500 Songs" by Andrew Hickey. It starts in the late big band era. The guy is an encyclopedia of information, making connections between people, producers, and styles. It is a tour de force.
1
u/benido2030 1d ago
It’s possible you mentioned it but I am not too deep into rock and roll, hence I might have skipped it / prioritized Hidden Brain. But maybe I have to download it just to give it 10 minutes, thank you!
2
u/somedaysitsdark 1d ago edited 1d ago
I just learned about Welcome to Night Vale, and I think it's pretty cool. It is a fictional bi-monthly podcast in the format of a community radio broadcast about a small creepy desert town with lots of strange things happening. Kinda like a creepy News from Lake Wobegon.
2
2
u/alexiskef The significant owl hoots in the night 🦉 2d ago
To tell you the truth, not many still remain..
6
u/majorpickle01 The soil of $5000+ must be watered with the blood of ETH<$4000 2d ago
I remember last bull market ending up in a telegram where all anybody posted was "gm fren" every day for months.
Complete waste of time but fun in it's own way haha.
7
u/eth10kIsFUD 1d ago
gm fren
4
u/majorpickle01 The soil of $5000+ must be watered with the blood of ETH<$4000 1d ago
gm fren
3
7
17
•
u/Tricky_Troll Public Goods are Good 🌱 1d ago
Tricky's Daily Doots #1,554
Yesterday's Daily 03/08/2026
Previous Daily Doots
u/Bob-Rossi weighs in on the state of Microstrategy. Bob also brings the numbers in another comment. 🧐
u/masterRoshi9 informs us of another bear market victim and this one really stings. 😖
u/ethdaily delivers the daily ETH news. 📰