The price of Ethereum(ETH) has seen a massive surge in the past months and this price increase has also been reflected in the value of assets in liquid staking derivatives (LSD).
The volume and the worth of the liquid staking derivatives had seen a surge since the beginning of the year with around 1.56 million ether being added to LSD protocols since January 6. Looking back at the fluctuations in the value of Ethereum, it has seen a steady increase.
The price of the cryptocurrency has increased by 12.5% in just the past week and the past month has seen an increase of 56.9%. According to available data, the value of Ethereum on Sunday at 5:15 EST is $3,9000 per coin.
This sudden surge in the price of the token is also reflected in the value of assets in liquid staking derivatives which are currently marked at $54.34 billion. This value accounts for more than half of the total value in decentralized finance (defi) protocols.
According to available data, considering the numbers from January 6, 2024, 1.56 million Ethereum was accumulated in the past 64 days. Looking at the initial number, 12.31 million ether was secured that day and it was valued at 27.49 billion.
Currently, the total has reached a value of 13.87 million, and the value is calculated to be $54.34 billion, which easily marks a $26.85 billion increase. A major portion of Ethereum is secured by Lido Finance and it accounts for 71.04% which is around 9.85 million Ethereum.
Rocket Pool follows it at the second place which secures 1.13 million Ethereum and accounts for a total value of $4.41 billion.
Following the larger number secured by Lido and Rocket Pool, the other names that manage significant numbers include Binance, Mantle, and Stakestone. Even though these numbers are significant, they manage ether which are less than 1 million each.
While 891,881 is the number of ETH overseen by Binance’s liquid staking derivative protocol, the number is 339,442 for Stakeson’s platform. Other than the mentioned entities, some of the other major names include Frax, Swell, Coinbase, Stader, and Stakewise.
Among these names, Mantle has experienced the largest growth over the last 30 days. The growth is calculated to be around 25.78% while there has been a reported decline for Frax and Coinbase. The decline for Coinbase is recorded at 1.95% and the decline for Frax was 3.79%.
Since the introduction of LSD, it has attracted and had significant growth and the addition of millions of ether has only added to this increase in value.
Even though Lido is the current leader when it comes to numbers, it is interesting and easily noticeable that the other competitors are also catching up gradually.
Within the following months, the growth is expected to continue its momentum as people are busy calculating the possible growth of LSDs in 2024.
According to experts and available reports, there are multiple benefits to LSDs and they also help to open up different possibilities when it comes to passive income generation from crypto asset holding all the while retaining flexibility to use liquidity at will.
Ethereum is the leading blockchain ecosystem with live liquid staking functionality and it owes to different service providers like Lido, Rockt Pool, Stakewise, and Stader Labs for this achievement and status.
However, different other networks are primed to unlock liquid staking such as Polkadot, Cardano, and Solana.
While it has a wide array of different benefits, there are a few different risks associated with LSDs like slashing, lack of insurance, fragmented liquidity, and contract and technical risk which need to be taken into consideration too.
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