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Ethereum Issuance Reduction Proposal Prompts Fierce Crypto Community Criticism

source-logo  news.bitcoin.com 02 April 2024 13:31, UTC

Discussions about adjusting Ethereum’s issuance curve due to staking concentration and other factors are taking place on social media, with some developers in favor and some against this change. A recent article by Mike Neuder, an Ethereum Foundation researcher, highlights that Ethereum issuance should “preserve the viability and proportion of solo stakers.”

Ethereum Issuance Curve Reduction Discussion Rips Community Apart

The Ethereum issuance curve is being scrutinized by different groups considering the latest trends and structures in the Ethereum protocol. A recent document titled “Issuance Issues,” authored by Ethereum Foundation researcher Michael Neuder supported solving several issues in today’s Ethereum reality by tweaking its token issuance. These include maintaining the viability of solo staking compared to liquid staking protocols and disregarding a high level of staking that would hurt staking rewards.

In his article, Neuder advocates for a reduction in Ethereum’s issuance to be applied in Electra, Ethereum’s next upgrade, supporting the ideas discussed by Ethereum Foundation researchers Ansgar Dietrichs and Caspar Schwarz-Schilling, in February.

While some like Neuder support reviewing this crucial element of Ethereum’s behavior, other researchers and developers have fiercely rejected this position. One of these is Eric Conner, co-author of the Ethereum Improvement Proposal 1559 (EIP-1559), who is radically against the proposed changes to Ethereum’s issuance curve.

Conner, whose proposal has helped Ethereum burn millions of dollars worth of ETH, stated that these changes disarm the community’s work on establishing ETH as money. He stressed:

The current push to tweak it is a completely over reaction to centralization concerns that are unfounded.

Conner emphasized that he would fight this idea “with anything” he has.

Ethereum core developer Ahmad Bitar also raised his voice against this change. Bitar stressed that the proposal’s objectives were unclear, claiming that the current issuance curve did not lead to value erosion. On the current issuance curve, he declared:

It has been negative since the merge, and it does not look like it is stopping any time soon. I don’t see the problem you guys are trying to solve here.

Ryan Berckmans, an Ethereum investor, also blasted the idea of reducing Ethereum’s issuance. He stated that the consequences of not changing this parameter were merely speculative, and would not hurt the community as much as a simple issuance curve reduction implementation. “If the previous magic number wasn’t sustainable, why should this new proposed number be sustainable? Analysis can’t put this question to rest. It’s a political issue,” he concluded.

What do you think about the proposal to change Ethereum’s issuance curve? Tell us in the comments section below.