Ethereum officially implemented Proof of Stake (PoS) in 2022, a more secure and eco-friendly way to verify transactions and incorporate new blocks into the blockchain. Since its creation, Ethereum staking has experienced consistent and continuous growth. It has achieved an impressive average monthly growth rate of 4.2% over the past year and a monthly growth rate of 13.3% since November 2020.
Most recently, data from April 30 of this year shows that an all-time high of 19.2 million ether (ETH) has been staked on the Ethereum blockchain network. According to BitcoinCasinos.com, this is a 24.2% jump from the previous record set in December 2022, when 15.9 million ETH was staked.
BitcoinCasinos financial expert Edith Reads commented on the data saying, “Ethereum staking has been one of the most remarkable stories in the cryptocurrency industry. In just over two years, it’s gone from a little-known concept to becoming one of the most important and popular methods for holding crypto assets.”
She continued, “The astonishing growth of Ethereum staking is testament to the scalability and versatility of the blockchain technology. The investments into Ethereum staking have also been an important source of capital for developers who are using the network to build a new kind of economy.”
What Is Ethereum Staking?
ETH staking is a process in which users can earn rewards for committing their ETH tokens to an Ethereum blockchain. Staked ETH tokens are held as collateral by the network, allowing users to validate transactions and receive rewards for their work. This helps secure the network and incentivizes continued usage of the platform.
Unlike proof-of-work mining, staking does not require specialized hardware or large amounts of electricity. This makes it more accessible to a more significant number of users and potentially increases the network’s security by distributing rewards among many validators instead of just a few miners.
What Increased ETH Staking Means For Investors
If you plan to hold Ethereum for a prolonged period, then increased staking could lead to greater returns. Higher ETH stakes mean higher rewards for validators, which in turn will drive up the value of ETH itself. This positive cycle could increase the price of Ethereum over time.
Additionally, increased staking means more users are locking their coins away to receive rewards, decreasing the circulating supply of ETH. This can also help drive up the price of Ethereum due to increased demand and decreased supply.
Lastly, staking can make the Ethereum network more secure and less susceptible to malicious actors. By locking up their ETH, investors help to protect the network from bad actors who may want to manipulate it for their gain. This helps to ensure that Ethereum remains a reliable and trustworthy platform for doing business on the blockchain.