Staking Ethereum has been the talk of the crypto world for the past week. However, staking levels are relatively low compared to other networks, but that might not be a bad thing.
The amount of Ethereum accumulated is about 14.3% of the total supply. Moreover, that number has dropped over the past week after Shapella upgraded and withdrawals opened.
On April 16, Web3 investor Ryan Berckmans saw that staking Ethereum would not reach the high levels seen on other tier one networks.
“Ethereum is very bullish, issuance is very low, and ETH is very beneficial for people to be interested in contributing.”
The bet involves locking in the asset, similar to a bank fixed deposit account. This is done for low, steady returns when there is not much to do with the asset.
The Ethereum Sticking Ratio is bullish
Berkmans Believes That low staking levels in Ethereum is actually a good thing.
In comparison, Cardano (ADA) staking rate is a whopping 66%, according to Staking Rewards. Solana’s accumulated amount (SOL) is 72% higher. Other networks, such as TRON, Cosmos, and Polkadot, all have staking percentages over 40%.
One of the factors behind this could be a minimum viable Ethereum issuance or mitigation. “(This) is a major factor here versus other chains overly diluting on purpose to manufacture a high pot percentage,” he said.
He added that if Ethereum were to issue 50% annually, “obviously everyone would be involved.”
Ethereum use cases and demand can be measured through network fees, among other things. As reported by BeInCrypto, Ethereum has beaten the competition in terms of fees generated over the past six months. And this is in a bear market!
Berkmans concluded that his recent change of heart is in line with the consensus in the Ethereum R&D community.
“In short, I think the fact that Ethereum has staking lows is actually very bullish and our staking lows were mostly attributed to this upside and good monetary policy rather than a lack of withdrawals.”
He concluded that even with the proliferation of liquid staking tokens, staking Ethereum is unlikely to reach the level of other networks.
According to Token Unlocks, just over 1 million ETH has already been withdrawn from the Beacon Chain.
Furthermore, there are about 877,000 in the pending withdrawal queue, but a lot of that is due to the Kraken staking campaign.
However, with around 373,000 in ETH deposits, the staking balance is only down by 646,700 since Shapella last week.
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