Ethereum has entered a critical stage in the transition to a stake-based model, with over 35 million ETHs locking up contracts and exceeding key thresholds.
This figure represents approximately 28.3% of Ethereum's total supply, worth more than $84 billion at current market prices.
Lido, Binance and Coinbase dominate Ethereum Validator Power
Blockchain analytics firm Sentora reports this is the highest percentage of ETH bets to date. The company said the trend accelerated in June when more than 500,000 ETH was bet in the first half of the month.
This increase follows clarity from the Securities and Exchange Commission (SEC). The agency's guidance gives institutional investors more confidence in the surprising outlook for Ethereum.
As a result, large investors, including whales, have shown growing interest in ETH, and have chosen to wager their holdings to gain more exposure to the long-term value of their network.
Despite the enthusiasm surrounding Ethereum's remarkable growth, concerns about its decentralization have emerged.
The top three Ethereum Stakers, Lido, Binance and Coinbase control almost 40% of all validator balances.
The dominant liquid staking platform, Lido holds around 8.7 million ETH, or 25% of all pile coins. Meanwhile, two major centralized exchanges, Binance and Coinbase, each manage around 7.5% of the staking market.
“Censored or suspended events affecting Lido, Binance and Coinbase will hit more than 40% of new blocks,” Sentora warned.
Top Ethereum Staking Entities. Source: Dune Analytics
This concentration of power has rekindled debate over Ethereum's decentralization model. The advantages of some entities raise concerns about the future governance and liquidity of the network.
Meanwhile, a surge in staking activity, coupled with around 19% of ETH, which are trapped in long-term holdings, is reducing the liquid supply available for trade.
As a result, ETH floats are approaching levels that are not visible before the merge, resulting in thinning orders and increasing market volatility. Furthermore, there are more sharp price fluctuations in the ETH Spot market, which amplifies both the gathering and the revision.
Furthermore, the defi platform also feels like its limit. Sentora noted that borrowing rates for liquid staking tokens like Steth, Reth and Frxeth are rising.
Sentora pointed out that if these tokens lack collateral for the unit, they may feel in a pinch. This could allow lending protocols to adjust strategies to accommodate tightening markets.
