ETH Staking Soars
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ETH Staking Soars: Liquidity Tightens as Investors Opt for Passive Yield
The Ethereum (ETH) network has reached a significant milestone, with a record 35 million Ethereum (ETH) now staked. This surge in staking activity has led to a tightening of liquidity, as investors increasingly prefer passive yield over short-term trades. Corporate treasuries, led by firms like SharpLink, are driving this trend, viewing Ethereum (ETH) as a long-term treasury asset.
Staking Activity Reaches New Heights
According to Dune Analytics data, the total amount of staked Ethereum (ETH) has surpassed 35 million tokens, marking a new all-time high for the Ethereum (ETH) network. This figure accounts for over 28% of the cryptocurrency’s circulating supply of more than 120 million tokens. As a result, the available liquid supply on exchanges is shrinking rapidly, with the potential to plummet further as more public companies and large institutions opt to hold rather than trade the asset.
Who’s Locking Up Ethereum (ETH) Supply?
Proof-of-stake has been rising steadily since the Ethereum (ETH) network transitioned to this consensus mechanism in late 2022. Recent months have seen a sharper uptick, with over 500,000 Ethereum (ETH) staked in the first half of June alone. Lido, the leading liquid staking protocol, now controls 8.75 million Ethereum (ETH), or roughly a quarter of all staked tokens.
Corporate Balance Sheets Drive Ethereum (ETH) Accumulation
The more significant shift is happening off-chain, where corporate balance sheets are quietly becoming Ethereum (ETH) accumulation vehicles. These firms are increasingly treating Ethereum (ETH) not just as a tech investment, but as a long-term treasury asset. Nasdaq-listed SharpLink Gaming, for instance, purchased $463 million worth of Ethereum (ETH) on June 13, becoming the second-largest known holder behind the Ethereum (ETH) Foundation. The company also announced it had staked over 95% of its total holdings to generate yield while contributing to the Ethereum (ETH) network security.
Broader Market Implications
The surge in Ethereum (ETH) staking activity has significant implications for the broader market. As more institutional investors enter the space, the demand for Ethereum (ETH) is likely to increase, driving up prices and further reducing liquidity. This could lead to a more stable and secure network, but also raises concerns about the potential for centralized control and decreased accessibility for retail investors. As the Ethereum (ETH) network continues to evolve, it will be essential for investors to stay informed and adapt to the changing market landscape.
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