The landscape of Ethereum staking has reached a significant milestone, with over 30% of the network”s circulating supply now locked in staking contracts. This noteworthy achievement was recorded at the end of January, marking a first for the network. As of February 17, approximately 36.9 million ETH—equating to about 30.4% of the total supply—has been staked across nearly 967,000 active validators.
Despite this surge in staking activity, the price of ETH has faced considerable pressure, having dropped from its summer highs of nearly $5,000 in late August to around $2,000. This price decline has coincided with a growing backlog for new validators, as approximately 3.92 million ETH currently sits in the validator entry queue, resulting in a wait time close to 68 days.
On the other hand, exiting the staking process has become significantly easier, with the exit queue now empty. However, withdrawals are subject to an additional delay of eight days before funds are transferred to withdrawal addresses. The validator exit queue previously experienced congestion, with waits extending beyond 45 days in September.
The annual percentage rate (APR) for staking rewards currently stands at approximately 2.84%. Within the staking ecosystem, Lido maintains its position as the dominant player, controlling roughly 24% of all staked ETH, amounting to about 8.7 million tokens, according to data from Dune Analytics.
Looking ahead, staking inflows are projected to rise through 2024 and into early 2025, with expectations of a decline later in 2025 as some participants begin to withdraw their ETH. The total value locked (TVL) in liquid staking protocols, which allow ETH holders to stake their tokens while retaining liquidity, reached record levels exceeding $85 billion last summer, sustained into early October. However, following a significant market downturn on October 10, liquid staking TVL has decreased to just under $40 billion.
As the Ethereum network evolves, the dynamic between staking activity and price fluctuations continues to present a complex landscape for investors and participants alike.
