Ethereum staking rewards drop to 3.1%, falling behind other layer 1 protocols
Ethereum staking rewards drop to 3.1%, falling behind other layer 1 protocols
According to The Block Data, the base staking reward rate for Ethereum has dropped to 3.1% annually, down from 3.5% in July. This rate in the Ethereum network is now lower than that of other major layer-one protocols, including Cosmos, Polkadot, Celestia, and Solana, where staking rewards range from 7% to 21%.
Nevertheless, Ethereum's lower staking reward percentage helps reduce inflationary pressure on the network. According to Ultrasound Money, Ethereum’s annual inflation rate is 0.51%.
As noted by Kaiko Research analysts, since August of this year, the average validator queue in Ethereum has been less than one day, rarely exceeding four days, compared to the peak wait time of 45 days in June. Currently, the entry queue for Ethereum validators stands at 473, compared to the peak of 95,000 seen in mid-April 2023.
"While staking inflow has slowed, the growth of Ethereum's largest staking provider, Lido, has also leveled off. Lido’s staked ETH (stETH) supply remained steady this year, averaging around 9.6 million ETH, indicating an overall slowdown in ETH deposited to the Beacon Chain contract,” Kaiko analysts report.
Meanwhile, Vitalik Buterin, Ethereum’s co-founder and chief architect, has announced ambitious new goals for the Ethereum “Splurge” phase—a critical component of Ethereum’s long-term roadmap aimed at significantly enhancing scalability, user experience, and security on the blockchain network.
