Wall Street finally turned staking into a dividend, now Ethereum and Solana want to shrink it
Grayscale’s updated ETF filings would pass Ethereum and Solana staking rewards through as cash distributions, but both networks are also considering protocol changes that would reduce those rewards at the source. Solana’s SIMD-0550 would double annual disinflation, reaching its 1.5% terminal inflation rate in about 2.8 years and cutting modeled staking yield from 5.84% today to 2.25% by year three. That would reduce issuance by 18.9 million SOL over six years, worth about $1.47 billion, while likely pushing some small validators into unprofitable territory. Ethereum’s draft EIP-8363 would burn a larger share of validator issuance as staking rises, potentially eliminating new issuance entirely once about half of ETH is staked. Supporters say both moves would curb dilution, strengthen scarcity narratives, and redirect capital from passive staking toward DeFi and other uses. Critics warn they may simply cut investor income, hurt smaller validators, and weaken the appeal of staking products if price gains do not offset lower yield.
