Sharplink CEO Joseph Chalom has come out against EIP-8363, the controversial Ethereum Improvement Proposal that is looking to cap the amount of ETH staked by instituting a progressive burn of validator rewards.
In an X post on Friday, Chalom said the draft would undermine DeFi, erase one of ETH’s key advantages over Bitcoin, and arrive at the worst possible moment for the network’s institutional momentum.
The proposal, formally titled "Tapered Issuance Burn," would gradually increase the portion of consensus-layer rewards that are burned as the staking ratio rises, reaching a full 100% burn — and thus zero issuance yield — once roughly 50% of the ETH supply is staked.
Introduced earlier this week, EIP-8363 has generated a significant amount of backlash and support, with critics noting that it could disproportionately hurt solo stakers and weaken Ethereum’s security.
Authors of the draft proposal include Ethereum Foundation researcher Justin Drake and EthCC founder Jérôme de Tychey, among others, who argue the change could act as a market-driven way to limit the amount of staked ETH while reducing dilution for non-stakers.
