Solana (SOL) And Ethereum (ETH) Are Now The Most Staked Cryptocurrencies

The market capitalization of all staked crypto assets reaches almost $95 billion, with ETH and SOL leading the pack.

Ethereum (ETH) takes the trophy for the most staked crypto asset following the successful Merge of the Beacon Chain consensus layer with the Ethereum execution layer on Sep. 15, 2022, information from StakingRewards.com reveals.

The network with the second-highest staking transaction market cap is Solana, with $12.7 billion. Hot on its heels is Cardano with over $11 billion, Binance Smart Chain with over $5 billion, and Avalanche with about $4.6 billion in locked assets. Rounding off the top ten blockchains are Polkadot, Cosmos Hub, Tron, Polygon, and Near Protocol. Of the top ten staked cryptocurrencies by market cap, Cosmos (ATOM) offers the highest yield of 17.89%.

Staking, the process of locking up crypto for an extended interval to earn rewards, can be a method for transaction validators to jostle for an opportunity to add a new block to the blockchain. A deterministic algorithm selects a node that has staked the most crypto to validate transactions.

In distinction, mining includes competing for a chance to add a new block of transactions to the blockchain using an energy-intensive computational process that has drawn concern from many quarters, including the Biden administration.

Staking was launched by blockchain developer Sunny King and Scott Nadal in a 2012 paper as a solution to bitcoin’s high power consumption.

Ethereum leads staking because it seeks to turn into ‘sound money

At press time, Ethereum, the world’s second-largest cryptocurrency by market cap, had 14,545,424 ETH staked, with 430,080 validators and an annual yield of 4.1% every year. Based on analytics agency Nansen, most of the ETH at present staked is not profitable at current Ethereum prices. At press time, Ethereum was trading at $1,360.79, in response to Coingecko.

The recent migration of Ethereum from proof-of-work to proof-of-stake launched a change in the issuance sample of the cryptocurrency and the possibility of the cryptocurrency acquiring the standing of “sound cash” via the introduction of a provide cap.

Since the Merge, 3,095.12 ETH has been injected into the circulating provide. An accompanying “price burn” mechanism controls the provision by eradicating ETH from circulation. Payment burn was launched in Ethereum Improvement Proposal 1559 in Aug. 2021.

Withdrawing staked ETH to reap interest won’t be possible till after the Shanghai upgrade in early 2023. To turn into a validator on the Ethereum network earlier than the Merge required staking 32 ETH. Staking pools also allowed aspiring validators to enter the race by contributing as little as 0.01 ETH.

According to the U.S. Securities and Exchange Commission chairman, the migration of Ethereum to a proof-of-stake blockchain may imply that the coin passes the Howey Test, the principal test used to deem whether an asset is a security.

Multiple staking methods offered

Most cryptocurrencies that may be staked supply various methods to earn staking rewards. Ethereum provides solo staking or running your own validator node. Staking as a service removes the burden of running a validator node however permits a participant to reap the rewards. Using staking pools is another option, where stakers are issued a so-called ERC-20 liquidity token representing their staked ETH.

Solana, the second largest staked cryptocurrency by market cap, offers delegated proof-of-stake, where tokens are delegated to validators running nodes.