• The total value locked (TVL) in three top Ethereum-based liquid staking protocols has risen to more than $11b, with Lido (LDO), Coinbase (COIN), and Rocket Pool (RPL) all seeing gains.
• Liquid staking is an automated process that allows users to stake their ETH on the Beacon chain, a proof of stake blockchain.
• Coinbase Ventures recently announced they would join Rocket Pool’s Oracle DAO, sparking debates about whether Ethereum is becoming too centralized.
Liquid Staking Protocols Surge in Ethereum
The liquid staking industry has been thriving on the Ethereum (ETH) network of late since the introduction of the Beacon chain. Liquid staking is an automated process that allows users to stake their ETH on the Beacon chain, a proof of stake blockchain. As of Feb. 9, the total value locked (TVL) in three top Ethereum-based liquid staking protocols had risen above $11b, with Lido (LDO), Coinbase (COIN), and Rocket Pool (RPL) all recording gains in the 20-40% range over the past month, according to DeFi LIama.
Why Are Liquid Staking Protocols Surging?
Ethereum’s beacon chain has been making waves lately due to its ability to support liquid staking. Like traditional staking, users still get rewards when they stake their tokens. However, they have the added benefit of moving their assets around while staked. Allowing users to maintain the liquidity of their tokens while they stake for better platform security enhances overall liquidity. Additionally, the Beacon Chain’s shorter staking window allows users to switch up their strategies rapidly to capitalize on market trends.
Market and Price Action Analysis
Coinbase and Rocket Pool have been making waves in the liquidity staking space. Coinbase Ventures recently announced they would join Rocket Pool’s Oracle DAO. According to a survey by Gnosis co-founder Martin Köppelmann, Lido currently controls 27.5% of staking, while Coinbase is in second place at 14.5%. This has sparked a debate about whether Ethereum is becoming too centralized, with Bitcoin maximalists arguing that this proves so..
Price Charts
Lido 3-month price chart shows it gained 17% over 7 days taking its price up to $2.71 as of Feb 9th with a market cap of $ 2 billion making it 30th largest crypto by market cap meanwhile rocket pool 3 month price chart also indicates 40 % increase over last month .
Conclusion
The recent surge in TVL can be attributed mainly due to increased adoption and trust among investors as well as technology update allowing faster transactions which promote higher liquidity levels hence higher discounts offered by platforms like lido , coinbase and rocket pool .