There has never been a way to switch off Ethereum’s staking contract. A proposal submitted just ahead of the Hegotá inclusion cutoff would create one.
A group of six researchers — among them Justin Drake of the Ethereum Foundation — is pushing for validator rewards to be burned along a sliding scale that steepens as staking expands. Once roughly 60.25 million ETH is staked, roughly half of all supply in existence, the burn tops out at 100%, leaving net issuance at zero.
That deserves a moment of reflection. This isn’t a fee adjustment or a client-side optimization. It’s a ceiling on how much ETH can ever exist, policed by the very mechanism that compensates the people keeping the chain secure.
How the burn actually works
At the end of each epoch — a window of 6.4 minutes in Ethereum’s terminology — a slice of every validator’s rewards is subtracted and destroyed rather than routed elsewhere. That slice rises linearly toward 100% the closer staking gets to the saturation threshold.
Nothing changes about what validators do or how they’re paid. Every transaction fee and tip earned from building blocks stays with them. The burn touches only freshly minted ETH.
Nor does it hit in one go. The deduction is phased in across 18 months, preceded by about six months while the upgrade is shipped — roughly two years of runway to adapt.
The argument: staking never stops paying
The authors frame it this way: even in a scenario where every single ETH was staked, yield would still hover around 1.5%. The incentive to stake more never disappears.
Jérôme de Tychey, one of the proposal’s co-authors, forecasts that staking will exceed 70 million ETH by January 2028 absent any intervention.
Beyond a certain threshold, the proposal argues, additional stake weakens Ethereum’s security instead of strengthening it. The ETH gravitates toward exchanges and staking providers rather than remaining with its actual owners, while smaller individual stakers are pushed out.
The queue tells its own story
Roughly 41 million ETH is staked at present, nearly 34% of supply. Trackers show a further 2.5 million ETH waiting in the entry queue for activation, with the wait stretching to six weeks or longer.
The exit queue, meanwhile, is empty of takers.
Because Ethereum limits the pace at which validators can enter or leave, lines form in both directions. That cap is there to stop a large bloc from entering or exiting quickly enough to destabilize the network. As things stand, around 57,600 ETH can be activated per day.
Where the pushback is coming from
Developers and market participants are divided over the proposal, and the criticisms are concrete rather than theoretical.
Writing in a blog post, Aave Labs chief executive Stani Kulechov argued that driving staking rewards down to zero would render ETH borrowing strategies largely unworkable. Data indicates that a large share of ETH borrowed through Aave is deployed into buying more staked ETH — a trade that only makes sense as long as staking returns exceed borrowing costs.
Mike Silagadze, who founded liquid staking protocol ether.fi, took aim at how the proposal was introduced as much as what it contains.
“EIP released with 48 hours notice for comments,” he posted on X, describing it as “a major network economics change with far reaching implications for all of DeFi.”
The change, Silagadze continued, would “self evidently push out solo stakers who aren’t subsidized by the EF or others” and deliver staking to “large centralized entities with zero cost of capital.” By his estimate, “seven of the top 10 DeFi protocols” would see capital flee.
His take on price was more direct still. “People who stake ETH don’t sell it,” he wrote, contending that the proposal “will halt any new ETH getting staked” and might send tens of billions of dollars’ worth of ETH back into circulation.
Why it probably misses Hegotá
Slated for the second half of 2026, Hegotá is Ethereum’s next network upgrade, with a focus on structural cleanup, censorship resistance and shrinking state size. Overhauling monetary policy was never part of that agenda.
The proposal landed only days ahead of the Aug. 6 inclusion deadline, bringing with it a draft implementation running about 300 lines — and no agreement among the validators and stakers whose yields would be trimmed.
Put together, that points far more toward a slip into a later fork than inclusion in this one.
The authors are well aware that timing is the entire case. Each month of delay, they point out, allows the staking ratio to rise by roughly another 1.5 percentage points. Enough missed forks, and 60.25 million ceases to be a policy goal and becomes reality.
For anyone staking right now, the figure that matters isn’t the burn timetable. It’s the entry queue: 2.5 million ETH backed up, six weeks deep, with no one lining up to leave.