By Tom Blitzer
Key Insights:
- Coinbase secures its spot as the second-largest ETH staking entity, analyzed by Colin Wu.
- Lido DAO’s staking influence grows, accounting for one-third of all staked ETH.
- Ethereum’s Shanghai upgrade boosts staker confidence, leading to a net addition of 7.84 million ETH since April.
Coinbase, a Prominent crypto exchange, has firmly positioned itself as the second-largest ETH staking entity. This revelation comes from a meticulous analysis by Chinese reporter Colin Wu. Besides this, Lido DAO’s escalating dominance in the ETH staking arena is fueling concerns about network centralization.
A Deep Dive into Coinbase’s ETH Staking Metrics
According to data expertly dissected by Dragonfly’s hildobby, Coinbase now boasts a remarkable 3.873 million staked ETH. Significantly, this represents 14.1% of the entire staked ETH. However, Coinbase’s achievement in the ETH staking realm is overshadowed by Lido DAO. The liquid staking platform impressively accounts for a hefty one-third of all staked ETH.
Other noteworthy contenders in the ETH staking sphere include Binance and Kraken. They respectively command a 4.2% and 3.0% share of the staking market. Meanwhile, the Figment staking pool is just a little behind, holding a 4.9% market slice.
Over the past six months, Coinbase has seen a substantial 44% surge in its ETH staking activities. Coincidentally, this surge coincides with the activation of the Ethereum Shanghai upgrade. Contrary to initial apprehensions, the Shanghai upgrade hasn’t deterred ETH stakers. Instead, it has amplified their confidence, leading to a net influx of 7.84 million ETH since its inception in April. Consequently, the total ETH now staked has reached 27.42 million. This figure represents a significant 22.81% of ETH’s circulating supply.
Lido’s Influence Casts Shadows on Ethereum’s Decentralization
However, the surging influence of Lido in the ETH staking market is not without its concerns. With the Proof-of-Stake Consensus model, the more ETH one stakes, the greater their sway in governance processes. Data from Dune Analytics highlights Lido’s 8.80 million staked ETH. This equates to a formidable 32.11% of the ETH staking market. Moreover, the platform has witnessed a 55% upswing in staking activity in the last six months alone.
Ethereum’s official blog sheds light on the implications of such dominance. Centralization worries are not unfounded. An entity with as little as 33% of staked ETH can hinder the network from finalizing blocks, even against a 66% majority. Additionally, if a validator’s stake reaches 55%, they gain the power to bifurcate the Ethereum chain into dual forks. However, it’s crucial to note that no concrete evidence suggests Lido DAO harbors any malicious designs for the Ethereum network.
At press time, ETH’s price stood at $1,635.25, marking a 0.44% dip in the past 24 hours, according to data from CoinMarketCap. Meanwhile, Its trading volume has decreased by 11.83%, now valued at $3,208,869,495 billion.