According to blockchain data, demand for liquid Ethereum staking options continues to rise after the merger. Demand for liquid Ethereum staking options continues to rise in the months that follow the merger.
Nansen’s analysis of blockchain data shows that in the months after Ethereum switched to proof-of-stake (PoS) consensus, a growing number of Ether ETH tickers down $1,275 were staked across various staking solutions.
According to blockchain data from a variety of staking solutions throughout the Ethereum ecosystem, staking solutions have been in high demand since Ethereum’s switch to PoS, and the highly anticipated Merge has been a boon for decentralized finance (DeFi) in general.
The Merge’s introduction of staked ETH as an entirely cryptocurrency-native yield-bearing instrument that has quickly outperformed other collateralized yield-bearing services is highlighted in Nansen’s report.
Although popular, automated market makers and liquidity providers like Uniswap pale in comparison to staked ETH solutions’ total value. The total amount of ETH staked in the top six cryptocurrencies is valued by market capitalization alone, with over 15.4 million ETH locked in Ethereum’s staking contract:
“Staked ETH is therefore the first yield-bearing instrument to reach significant scale in DeFi, and it has the potential to significantly expand and radically transform the ecosystem in the coming years,” the statement reads.
From data on liquid-staked derivatives, Nansen provides some interesting insights. Validators, who had to deposit or stake 32 ETH in order to propose new blocks and receive protocol rewards when Ethereum switched to PoS, took their place as miners. Pooled staking, also known as liquid staking, is an option for users who are unable or unwilling to stake 32 ETH. Users can also withdraw staked ETH at any time thanks to this.
According to Nansen’s metrics, there is a preference for long-term holders in liquid staking holdings, and recently launched protocols are attracting new deposits more quickly than established services. Staking pools like Lido and Rocket Pool hold 5.7 million of the 14.5 million ETH staked in the ecosystem, or more than 40% of the total staked ETH.
With a 79% share of the total supply of staked ETH on the market, Lido’s staked ETH (stETH) pool dominates the market. Aave, Curve, and Lido’s wrapped stETH contracts contain 52% of the stETH tokens, indicating interest and utility for investors and DeFi applications. Since the Ethereum Merge, stETH’s average daily trading volume has also increased by 127 percent.
In contrast, the Rocket Pool (rETH) and Coinbase (cbETH) stake pools have experienced the greatest growth over the past three months, with 52.5% and 43.3%, respectively. Despite only being launched in August 2022, the supply of Coinbase’s cbETH has already surpassed that of any other asset except stETH.
The expansion of Coinbase’s ETH staking option also indicates that common users continue to have faith in centralized entities and are content to earn yield from staked ETH rather than more complicated yield-bearing strategies on the chain.
