Glassnode conducted an analysis on how the recent surge in restaking protocols could impact Ethereum’s role as a monetary asset.
The introduction of the EigenLayer and LRT staking protocols has boosted ETH’s staking share to 26% of the total supply. Analysts have observed a significant rise in the total amount of coins staked, reaching 31.4 million Ethereum (ETH) as of April 13.
Despite the decrease in non-validator rewards due to the increase in ETH staking, Glassnode warns that the overall rewards paid out could still contribute to inflation if a substantial amount of assets remain locked.
Following the Merge, the percentage of new coins in the total Ethereum supply has reached 1.01%, with approximately 3.55% of ETH withdrawn from circulation during this period.
As a result of this increase in metrics, the reward level for network security per validator has decreased to 3.2% annually.
Innovations such as MEV, liquid staking, restaking, and liquid restaking have led to a growing demand for staking services beyond their original purpose, experts suggest. Liquid restaking protocols now account for 27% of the coins deposited into staking contracts.
With more ETH being staked, the impact of inflation is felt by fewer asset holders, resulting in a wealth transfer to those who earn additional income from maintaining network security.
Experts have highlighted that over time, the real yield component could make owning ETH less appealing, potentially undermining Ethereum’s role as a monetary asset in the ecosystem.
Restaking enables users to stake their assets multiple times on the main blockchain and other protocols. The restaking sector has seen active growth since the beginning of the year.
By early April, the total value locked (TVL) in restaking protocols surpassed $8 billion, with the ether.fi project leading the way with $3.2 billion.
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