Aave founder and CEO Stani Kulechov has spoken out against an Ethereum Improvement Proposal submitted to the Ethereum community, arguing that it would fail to achieve its intended objective and instead damage Ethereum. In his view, the proposal would cap ETH staking yield at 0% once the staking ratio exceeds 50%, making staking returns unpredictable and, for many participants, potentially not worth pursuing at all. He said that would create a negative signal for institutional buyers considering ETH positions, as some may prefer other networks with more predictable cash flows, raising a meaningful adoption cost for Ethereum. Kulechov also argued that a drop in yield to 0 would make ETH lending strategies largely unworkable, effectively killing ETH lending and yield use cases. Under that setup, he said, the main reason to borrow ETH would be to short it, while holders seeking both ETH beta and yield could rotate into yield-bearing assets such as stablecoins. From his personal perspective, he said the proposal would weaken ETH’s viability as an asset and limit its potential, adding that Ethereum should not be punished for its growth.
According to ChainCatcher, Aave founder and CEO Stani Kulechov has opposed an Ethereum Improvement Proposal submitted to the Ethereum community, saying the proposal would miss its intended goal and instead harm Ethereum.
Kulechov said the proposal would push the cap on ETH staking yield down to 0% once the staking ratio rises above 50%. He argued that such a design would make staking returns unpredictable and, for many participants, potentially completely uneconomic.
Concerns over staking economics and institutional demand
He said that would be a negative factor for institutional buyers considering building ETH positions. In his view, some of those buyers could shift to other networks that offer more predictable cash flows, creating a significant adoption cost for Ethereum.
ETH lending and yield strategies could become unworkable
Kulechov also said that if yield falls to 0, ETH lending strategies would become largely infeasible. He described the likely effect as killing ETH lending and yield-related use cases, with borrowing ETH then making sense mainly for shorting.
He added that holders willing to take ETH beta along with yield may instead move into other yield-bearing assets, including stablecoins.
Says Ethereum should not be penalized for growth
From his personal perspective, Kulechov said the proposal would weaken ETH’s viability as an asset and limit its potential. He said he hopes the proposal does not move forward, warning that many participants could turn their attention to other networks, and added that Ethereum should not be punished for its growth.
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