I can understand why big players who have lots of ETH to stake can be opposed to EIP-8363 at first sight. But it's a lot more puzzling to see solo stakers opposing it 👀
It's not a straightforward concept to grasp and this is why it's important to go beyond the tag lines and ad-hominem you see on twitter.
Let me explain that in cookies term (and "yes", I used AI to ELI5 it, cancel me all you want!):
1. Imagine a big cookie jar that everyone shares.
2. Right now, every time someone puts more cookies into the jar, the jar gets a little bigger and gives out more cookies overall.
3. It never stops rewarding people for adding more: The big kids (large staking companies) keep dumping in more and more cookies because they always get even more cookies back. They grow bigger and bigger.
4. The little kids (home stakers with just a few cookies) watch their share of the reward get smaller and smaller. The big kids take up more space, so the little kids end up with fewer cookies relative to what they put in. Eventually some little kids get tired and stop playing.
In other words:
* Big entities keep adding stake → their absolute income rises.
* Solo staker keep the same stake → their absolute income falls (dilution).
* This process has no natural stop under the current rules, so large operators can keep expanding and continuously compress yields for everyone else.
EIP-8363 reverses the dynamic FOR THE LARGEST PLAYERS FIRST.
It removes the perpetual incentive for unbounded stake growth by the biggest operators while leaving solo stakers’ marginal incentive intact until much higher network participation.
Fixed operating costs remain a real issue for home stakers whenever yields fall (including under the current curve btw), but the proposal itself is designed so that large operators hit the "growth no longer pays" wall earlier.