
Ether Staking Loses Appeal as Yields Decline, Traditional Assets Regain Favor
Ether staking yields have diminished in attractiveness, with current payouts on pledged tokens averaging an annualized 3.5%, according to David Lawant of FalconX. This yield is now below the 5% offered by U.S. government bonds, marking a shift from the low-interest rates seen during the pandemic toward more traditional financial assets.
Data from the Validator Queue indicates a notable decline in the waiting list for validators on the network, reflecting reduced demand for Ether staking. The volume of validators significantly affects these staking payouts.
Platforms like Lido and Rocket Pool, which gained popularity after upgrades to the Ethereum network, have increased accessibility to staking rewards. However, strategists at JPMorgan Chase, including Nikolaos Panigirtzoglou, believe this surge in accessibility has diminished Ethereum’s yield appeal compared to conventional financial assets.
Other blockchain networks, such as Solana and Cardano, also utilize staking, with around 72% of Solana’s SOL token and 63% of Cardano’s ADA token currently staked. In contrast, Ethereum’s staking ratio is 22.6%, which differs significantly from another blockchain’s non-staking method.
According to data from Dune Analytics, provided by 21Shares AG, there has been a substantial decline in the number of staked Ether coins from May to September, coinciding with a downturn in the digital asset market. Despite Ether’s increase in value year-to-date, it is trailing behind Bitcoin’s gains, which have been fueled by speculation regarding the potential approval of Bitcoin exchange-traded funds in the U.S.
Recent reports from digital asset research firm Kaiko note that Ether’s price rose by 1% to $1,581, while Bitcoin’s value increased by 1.7% to $29,211 on Friday.
This article was generated with the support of AI and reviewed by an editor.