Ethereum 2.0 nears $4 billion in blockchain value with over 2% of supply in staking

Ethereum is now the third-largest blockchain in terms of staked funds, and still has plenty of room to grow

Just over a month after launch, the Ethereum 2.0 blockchain holds 2.7 million Ether (ETH), equivalent to $3.8 billion.

The combination of the Ether price rally and the ever-growing number of stakers have propelled Ethereum 2.0 into third place on the list of blockchains with the most staked funds. This is an increase of over 1 million ETH since Cointelegraph’s last report, published on 18 December. Since then, Ethereum has overtaken Tezos (XTZ) but still remains behind Polkadot (DOT), with $10.4 billion blocked, and Cardano (ADA), with $8.3 billion.

Compared to other competitors in this space, the percentage of blocked supply in Ethereum staking is significantly lower. Both Cardano and Polkadot see over 60% of tokens committed to staking, while Tezos‘ stakers make up 90% of the outstanding supply.

Eth 2.0 Deposit Agreement Statistics
Statistics on the Eth 2.0 deposit contract. Source: Etherscan
In contrast, only slightly more than 2% of Ether’s offering is in the deposit agreement. Participant staking, as reported by beaconcha.in, is slightly lower as new deposits are only registered by the Ethereum 2.0 blockchain after a waiting period of about two weeks.

The return on staking, according to beaconcha.in, is about 9%, which is about average. According to stakingrewards.com, the return is lower than the rewards of Polkadot and Avalanche but higher than most other staked blockchains.

Ethereum stakers face the additional obstacle of not being able to withdraw their funds until the developers complete the transition to the Proof-of-Stake blockchain. While this is a top priority, there is no concrete timeline for this process.

Until then, stakers can access their liquidity through third-party services. Several exchanges, including Kraken and Binance, offer custodial staking services with the ability to sell Ether on the exchange. Services such as LiquidStake allow borrowing against a user’s stake, while several DeFi projects, such as Cream Finance and Lido Finance, provide users with tokenized versions of their staked Ether. These tokens can be converted back into mainnet ETH on platforms such as Curve, but the exchange rate may not always be 1:1.