With a record 35 million Ether (ETH) now staked, liquidity within the Ethereum ecosystem is tightening as investors increasingly prioritize passive yield generation over short-term trading strategies. This trend is being further accelerated by corporate treasuries, with companies like SharpLink leading the charge in staking adoption.

Ethereum Staking Hits a New Milestone

The total amount of staked Ether has surged past 35 million tokens, setting a new all-time high for Ethereum’s proof-of-stake network. This figure represents over 28% of Ethereum’s circulating supply, which exceeds 120 million tokens. With such a significant portion of ETH locked in staking contracts, the available liquid supply on exchanges is shrinking rapidly. This trend may continue as more public companies and institutional investors choose to hold and stake Ethereum rather than engage in active trading.

Why Is ETH Supply Being Locked Up?

Ethereum staking has steadily grown since the network transitioned to a proof-of-stake consensus mechanism in late 2022. Recent months, however, have seen a sharper increase in staking activity. In the first half of June alone, over 500,000 ETH was staked, pushing the total staked supply beyond the 35 million mark.

Data shows that liquid staking protocols like Lido dominate the market, controlling approximately 8.75 million ETH, or around a quarter of all staked tokens. Centralized exchanges such as Coinbase and Binance collectively validate an additional 15% of the network. These platforms provide users with convenient staking options, contributing to the growing trend.

The Role of Corporations in Ethereum Staking

While retail investors and staking platforms play a significant role, a noteworthy shift is occurring off-chain. Corporate balance sheets are increasingly being used to accumulate and stake ETH. Companies are beginning to view Ethereum not just as a technology investment, but as a long-term treasury asset.

A recent example of this trend is Nasdaq-listed SharpLink Gaming, which recently purchased $463 million worth of ETH. This acquisition makes the company the second-largest known holder of Ethereum, behind only the Ethereum Foundation. SharpLink has staked over 95% of its holdings to earn staking rewards while actively supporting Ethereum’s network security.

Why Are Companies Moving to Stake ETH?

The logic behind corporate staking is strategic and structural. Ethereum currently offers an average staking yield of approximately 3%, providing a reliable source of passive income. Additionally, regulatory clarity from the SEC in May 2024 has boosted institutional confidence. The SEC confirmed that protocol-level staking mechanisms do not fall under securities regulations, removing a significant barrier for corporate and institutional participation.

Key Takeaways for Investors

For individual investors and institutions alike, the growing popularity of Ethereum staking presents unique opportunities and challenges:

  • Reduced Supply: With over a quarter of Ethereum’s circulating supply locked in staking contracts, reduced liquidity could influence market dynamics and potentially drive price movements.
  • Passive Income: Staking offers a stable yield, making it an attractive option for long-term holders seeking to generate passive income.
  • Institutional Adoption: Increased participation by corporations and institutions could further legitimize Ethereum as a mainstream asset.

As the Ethereum ecosystem evolves, staking is becoming a cornerstone for both individual and institutional investors. The trend of locking up ETH supply for yield generation and treasury asset purposes is likely to continue, further shaping the future of the cryptocurrency market.

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