A new update is coming to the Ethereum

At the last meeting, Ethereum developers approved the EIP-7514 update for the Ethereum network, which is planned to be implemented by the end of 2023. This Ethereum Improvement Proposal (EIP) will mainly aim to slow down the Ethereum staking service. Thus, it is planned to gain time to create an advanced reward mechanism for validators.

The update, announced by Tim Beiko, one of the Ethereum Core developers, addresses concerns about staking. The continuation of the increase in the staking rate may result in a decrease in the amount of ETH used in trading activities. While this is considered a step towards supply scarcity in Ethereum, it is also a factor that positively affects the asset price. However, it seems that the developers advocate for slowing down the system with the update they reached a consensus on. This shows that core developers are concerned that technical and security problems may arise in rapidly growing staking activities. Accordingly, the EIP-7514 update is expected to have an indirect effect on the ETH price by interfering with the ETH supply. However, the impact on price seems likely to occur in the long term.

In the details of the EIP-7514 update, it is emphasized that the update will provide a temporary measure, citing the increase in ETH staking service despite the modest return. It is thought that this will give the community time to evaluate the current challenges and find permanent solutions. As a result, it is highlighted that EIP-7514 may have long-term effects on staking activities and management of ETH supply. The first results of this update will be closely monitored starting from the first quarter of next year.