Ethereum Staking: Profitability and Trends
Ethereum Staking Profitability
On-chain data reveals a significant insight into Ethereum (ETH) staking trends. Following the crypto winter of 2022, only around 20% of all staked ETH is currently in profit. This stems from a majority having staked their ETH at or above current market prices. As of now, ETH trades at approximately $1,250, a sharp decline from its all-time high of $4,891. The most profitable staked ETH was acquired at around $600 in December 2020, coinciding with the launch of the Beacon Chain.
Current Staking Landscape
Approximately 15.89 million ETH, accounting for 13.2% of the total ETH supply, is presently staked. A significant portion of this was staked at prices higher than $1,200. Ethereum developers are preparing for the Shanghai Upgrade, slated for March 2023, which aims to release the staked Ether.
Lido's Dominance in DeFi
Lido Finance has emerged as a leader in the decentralized finance (DeFi) sector, with a total value locked (TVL) surpassing that of MakerDAO. Currently, Lido holds $6.15 billion in TVL, representing 29.23% of the total staked ETH on the proof-of-stake (PoS) chain. December saw a notable increase in staked ETH, enhancing Lido’s dominance.
Trends and Market Sentiment
Despite fluctuations, Ethereum staking remains a favored strategy among investors, who view it as a long-term investment opportunity. However, the weekly amount of ETH staked has decreased significantly since mid-November, plummeting to 25,000 ETH from a peak of over 150,000 ETH weekly. This trend underscores the shifting dynamics in the market and the cautious approach of investors amid market volatility.
Understanding these trends is crucial for investors and stakeholders aiming to navigate the evolving Ethereum landscape and capitalize on future opportunities.
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