Since Ethereum’s Shapella upgrade on April 12, 2023, which occurred at block height 6,209,536 and enabled stakers to withdraw for the first time, more than 400,000 ether has been added to 17 liquid staking platforms. The total value of ethereum locked in liquid staking protocols like Lido Finance, Coinbase’s Wrapped Staked Ether, Rocket Pool, Frax, Stakewise, Stakehound, Ankr, Ether.fi, and Bitfrost now exceeds $16 billion. As the popularity of these platforms grows, users can earn passive staking rewards while still maintaining control over their assets.
The Shapella upgrade marks a significant milestone for Ethereum, as it has not only allowed users to withdraw their stakes but also added 400,735 ether, worth $763 million, to the liquid staking cache. Among the top ten platforms, six have seen gains in the past month, with four of them experiencing double-digit growth. Lido Finance dominates the market, accounting for 73.6% or 6,206,101 Ethereum out of the total 8,431,605 locked in liquid staking.
Despite the success of Lido Finance, other platforms are also reporting impressive results. Rocket Pool, for instance, saw a 29.24% increase in its total value locked (TVL) over the past 30 days, while Frax’s TVL rose by 31.65%. Stakewise, the fifth-largest liquid staking platform, saw a modest growth of 1.23% in the same period.
However, not all platforms have witnessed such positive trends. Coinbase’s liquid staking platform suffered a loss of 0.64% in the past month. This could be attributed to the rapid growth of other more specialized platforms and the increasing competition in the sector.
As more users continue to lock their Ethereum into liquid staking protocols, the market’s total value locked (TVL) has grown exponentially. Binance, for example, recently joined the liquid staking market by launching its product, which holds the tenth position, just below Bitfrost. Currently, Binance’s liquid staking platform has a TVL of around $38.69 million, with 20,305 ether staked into the application.
Liquid staking during the Ethereum 2.0 era has had a significant impact on Ethereum’s landscape, as users can now earn rewards while maintaining control over their assets. The addition of over 400,000 ether to the liquid staking TVL within just two weeks of the Shapella upgrade emphasizes the growing interest and attention this sector is receiving.
The growing adoption of liquid staking may lead to significant changes in the DeFi space. As more users enter the ecosystem, the demand for ethereum-based DeFi services is bound to rise. This could potentially result in the increased usage of Ethereum as a popular choice for Decentralized Finance (DeFi) applications.
Moreover, the accessibility and ease of use offered by liquid staking platforms are proving attractive to users who may have otherwise been hesitant to participate in traditional staking methods. With many platforms currently experiencing growth, both in terms of user base and total value locked, liquid staking protocols could become an increasingly popular means of passively generating income from cryptocurrency investments.
As more users lock their Ethereum into liquid staking platforms, the DeFi ecosystem is expected to strengthen, adding to the growing list of platforms that facilitate a range of decentralized financial services. This could potentially lead to Ethereum becoming the go-to choice for a broader range of users, from investors seeking passive income streams to developers building innovative decentralized applications.
In conclusion, the Ethereum Shapella upgrade has significantly impacted the liquid staking landscape, adding a considerable amount of value to the liquid staking cache and driving the rapid growth of several platforms. As adoption continues to rise and the DeFi ecosystem strengthens, Ethereum’s role as a staple in decentralized finance seems set to continue growing. The success of liquid staking protocols, both in terms of user adoption and market valuation, highlights their potential as an effective means of generating passive income from cryptocurrency investments.
