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Leon Waidmann | Onchain Insights
@leon-waidmann
šØSOLANA just flipped ETHEREUM in staking market cap! ā¢ Solana: $56.7B | 65% staked ā¢ Ethereum: $56.2B | 29% staked But hereās what most people miss: Ethereum staking is about to explode. Why? One word: Pectra šš§µ āø» 1. Big unlock for big stakers š· EIP-7251 raises validator cap from 32 ā 2048 ETH š· Whales and institutions can stake more with less infra š· Rewards now compound on the full balance āø» 2. Staking becomes seamless š· EIP-6110: deposits recognized in minutes š· Less waiting = more participation from retail and funds āø» 3. Yields go up ā automatically š· Auto-compounding boosts effective APY š· No manual restaking needed š· Better returns, same effort āø» If ETH staking hits 40%: š· 48M ETH staked š· At $1,980 = $95B staking market cap ā Thatās +69% from today ā Clean flip of Solana āø» Pectra isnāt just a protocol upgrade. Itās a capital unlock that could reshape ETHās entire economic layer. Donāt fade the shift.
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xh3b4sd ā
@xh3b4sd.eth
I think some of the takes here miss the mark for what is actually relevant. It is true that Pectra will improve staking economics. The same amount of stake requires far fewer resource, making it more capital efficient. The question we have to ask n the research side is how much economic security is "enough". We don't want to have more than 30% of ETH staked for various reasons. Staked ETH doesn't increase Ethereum's utility function, which is where the actual value accrual takes place. And further, more staking increases centralization risks while at the same time reducing real yield. At a certain point the amount of economic security becomes less important. Because what really matters is the quality of this security, and what it actually secures.
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CryptoPlazaš©š§āš¾ OG449
@especulacion
I spoke with the Ethereum Foundation research team during ETHCC about this very topic ā particularly the idea of reducing staking rewards. In my view, this is clearly a negative measure for the demand side of ETH. There seems to be a lack of sensitivity in understanding what the core sources of demand for ETH actually are ā and in the end, these are what define its price. Iām not sure I would frame it strictly as a "security" issue ā thatās another debate ā but whatās clear is that a significant drop in price negatively impacts the broader ecosystem. There was no serious analysis of how Dencun affected demand, and now once again, weāre seeing very little reflection on the potential market impact of critical upgrades like Uniswap V4 and the launch of Unichain. In this context, I believe that disincentivizing staking ā even if itās for ostensibly valid reasons ā is ultimately a harmful decision for the Ethereum ecosystem unless it's backed by a rigorous analysis of its downstream effects.
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xh3b4sd ā
@xh3b4sd.eth
On the demand side I would frame it differently. Blob space increased Ethereum's real estate. If anything, Dencun flushed out speculation based on some funny DCF type of thinking, which frankly doesn't work well for public blockchains anyway. Crypto's forward P/E ratios are completely retarded. Ethereum has all the fundamentals. Price is short term noise to me. On the issuance curve I would agree with you. We can chose to maximize or minimize certain aspects of the system. Instead of artificially minimizing supply, we should focus on maximizing demand. There is only one supply mechanism. But there are dozens, if not hundreds of demand mechanisms, most of which we have probably not even discovered, less understood.
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CryptoPlazaš©š§āš¾ OG449
@especulacion
The discussion around how to value Ethereum is certainly a fascinating debate. But beyond that, a collapse in Ethereum's demand at the scale we've witnessed can't reasonably be expected not to impact the price. It simply wasnāt necessary to collapse demand so aggressively in order to scale. In fact, the market is telling us exactly that by pushing gas prices below 1 gwei. I believe it's worth revisiting the theory of the Laffer Curve, which teaches us that beyond a certain point, reducing taxes yields only marginal growth in economic activity. A higher minimum gas price wouldnāt have hindered scalability. What weāve done is leave the ecosystem without demand, just as excessive tax cuts would leave a state without revenue. We shouldnāt be afraid to defend Ethereumās premium ā because, as weāve seen time and again, a large part of the demand for Ethereum is inelastic.
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xh3b4sd ā
@xh3b4sd.eth
You are still focusing on speculative demand, while I talk about structural demand. It doesn't make much sense to talk past each other here. We increased the structural demand with Dencun, which we can see based on L2 adoption and the increase in economic activity there. Literally all numbers are up, except price. What has been decreased was the speculative nature of ETH. I don't think that is bad long term. It is also funny that the only asset evaluated based on fundamentals in this space is ETH. Higher minimum gas prices for blob space are also coming this year.
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