Galaxy Research has advised clients that proposals under consideration on both Ethereum and Solana to reduce token issuance rates will not, on their own, determine the future prices of either asset. The firm argues that demand — not changes to supply — is the primary driver of token price direction, even as both networks weigh changes that could alter staking incentives and future emissions.

Galaxy Vice President of Research Lucas Tcheyan conveyed this assessment in a client note, as developers on both chains advance plans to slow the rate at which new tokens are minted. Galaxy's broader analysis is available in its research report.

Ethereum's EIP-8361: Tapered Issuance Burn

Ethereum's proposal, EIP-8361, introduces a "tapered issuance burn" mechanism that would reduce validator rewards down to zero once 50% of all Ether (ETH) is staked. At the current staking rate of approximately one-third of total supply, consensus-layer yield would decline from roughly 2.6% to 1.2%.

The proposal was filed by six researchers, including the Ethereum Foundation's Justin Drake. It would be implemented over an 18-month transition period, giving stakers nearly two years to adjust.

No vote has taken place. The proposal is being evaluated for inclusion in Hegotá, Ethereum's upgrade following Glamsterdam, which is expected this fall. The selection process extends into November, and final approval would likely not ship until well into 2027.

Opposition has been vocal. As previously reported, Aave founder Stani Kulechov and Sharplink have both come out against the plan. Sharplink CEO Joseph Chalom argued on X that validators could operate at a loss once hardware and electricity costs are factored in. A validator survey found 99.77% opposition, and during the August 6 All Core Devs call, the presenting author even suggested withdrawing the proposal from consideration entirely.

Solana's Dual Proposals Through On-Chain Governance

Solana is advancing two proposals through its new on-chain governance system.

The first, SIMD-0550 (SGP-0002), was authored by Helius engineers Lostin and 0xIchigo. It would double the annual disinflation rate to 30%, moving the 1.5% terminal inflation floor forward to 2029 from 2032 and eliminating approximately 18.9 million SOL from future emissions. Under the authors' 68% staking-participation scenario, staking yield would begin at 5.84%, then decline to 4.34% after one year, 3% after two years, and 2.25% after three years. Helius published a detailed blog post on the proposal.

The second, SIMD-0553 (SGP-0003), proposed by Temporal's cavemanloverboy, would replace Solana's flat per-signature fee with a resource-based charge that scales with a transaction's compute demand and is burned entirely. Galaxy estimated this could raise daily SOL burns from roughly 650 to between 7,500 and 9,000 — increasing daily burn value from approximately $47,000 to up to $650,000 at current prices. However, even at the high end, the burn remains offset by roughly 60,000 SOL in daily inflation.

Solana's proposals have generated less controversy than Ethereum's, which Galaxy partly attributes to the fact that versions of these ideas have been circulating for over a year. In both networks, the near-term focus is less on whether supply changes can matter at all than on how much they would alter validator economics, staking participation, and governance priorities if adopted.

Both proposals have cleared the 15% active-stake threshold required to enter discussion and need two-thirds of decisive stake to pass. The discussion period ends August 22, 2026. DeFi Development Corp. (Nasdaq: DFDV), which holds SOL as its primary reserve asset, announced on August 4 that it supports both proposals and will vote in favor.