Staking Insider #8

GM fellow staker,

We’re here to share a healthy dose of staking insights, before you head into the weekend. Let’s do it…

🧵 In this week’s edition:

• 📈 ETH Staking Ratio: Present vs. Future

• 🔎 A Look at the ETH Validator Activation Queue

• 📰 Weekly Briefing

• 🤓 Metric of the Week

Read time: 3 minutes

📈 ETH Staking Ratio: Present vs. Future Outlook

As of today, the staking ratio of Ethereum is 18.58%. This total represents the percentage of eligible tokens that are currently being staked in the network.

Over the past 90 days, this has increased by a whopping +3.7%!

While this growth is significant, there is still a long way to go for Ethereum to catch up with the staking ratio of other top POS Networks, such as Solana (70.67%), Cardano (62.21%) or Cosmos (69.94%).

As a comparison, let’s take the next top 10 POS Networks by Staking Market Cap. The average staking ratio of all 10 combined is currently 55.23%. This gives an indication of what the staking ratio of Ethereum could look like in the future.

Taking a more conservative view, imagine if the staking ratio of Ethereum hit 50% one day. This would mean the Staking Market Cap of Ethereum alone would be worth $112.36B at today’s current market price, pushing the Global Staking Market Cap up to $173.68B.

Assuming the staking ratio of other POS Networks remained the same, Ethereum would make up for 64.7% share of the entire Global Staking Market Cap, as shown in the below chart.

🔎 A Look at the ETH Validator Activation Queue

Demand for staking on Ethereum has been strong ever since the Shapella upgrade back in April.

As of today, the number of ETH validators waiting to enter the network is 75,072, and with them an amount of ETH totalling 2,402,304 is waiting to enter.

This massively overshadows the amount of ETH waiting to exit, which is currently only 832 ETH.

While this is great news for Staking on Ethereum, you may be wondering “What’s the hold up?”. The Ethereum network imposes a churn limit on how many validators can enter or exit each epoch (approx. 6.4 minutes). This is controlled dynamically, to protect the stability of the network and varies depending on the number of validators in the queue.

At present, the wait time for a new validator to join the network is 34 days. To unstake it’s 7 days.

As demand for staking on Ethereum increases, we can expect the amount of time it takes for new validators to be able to stake ETH to continuing creeping up.

📰 Weekly Briefing

Here’s this week’s top news from the world of staking and crypto…

• Proactive funding for ETH Projects Through the Meta Pool LST

• Tenderize Announce v2 of their Liquid Staking Protocol

• $1.5B in Crypto Leaves Curve Finance After Hack

• The Sandbox implements KYC measures for protocol staking

• Mysten Labs’ Sui enables liquid staking with network upgrade

🤓 Metric of the Week

The Staking Asset Explorer is a treasure trove of data!

This week we’re taking a look at the Inflation Rate. This metric represents the annualized monetary expansion of an asset, based on its current token reward payout, reward accrual interval, and total supply change.

The Inflation Rate can provide insight into the long-term supply dynamics of an asset. Higher inflation rates may lead to greater token supply growth and dilution of existing token holders' holdings, while lower inflation rates may contribute to greater scarcity and price appreciation over time.

Below you can see the Inflation Rate of KAVA, SUI, ROWAN and APT in a side-by-side format.

👀 Last But Not Least

⛰️ Register for the LSTfi summit, now taking place on 5 Sep
⚙️ Sign up for access to our Staking Data API when it goes live

🎬 That’s a Wrap!

We’re hyped to have you as a reader of the Staking Insider newsletter. Let us know what you thought of this week’s edition…

Disclaimer: None of this is financial advice. The Staking Insider newsletter is strictly for educational purposes and is not investment advice. Please be careful and always do your own research.