Decentralized finance (or DeFi) platforms are not going through their best year. So far in 2022, more than 3,000 ethers (ETH), Ethereum’s cryptocurrency, have been withdrawn from these protocols. The only DeFi market that seems to remain attractive to investors are the version 2.0 staking pools of the network.
It is worth clarifying that we are referring to liquid staking pools, which allow the investment to be withdrawn at any time. These have had a sustained growth of deposits in most of the year. And, since May, after a major drop, the amount of ETH on these platforms has remained stable.
We will take Lido as a representative example, a pool that currently owns more than 30% of all ETH in staking. This decentralized pool seems not to be suffering from the current bear market.
According to the portal DeFi Llama, lThe ETH deposited on the platform they peaked at over 6 million ETH. A growth of 100% compared to the end of 2021.
In contrast, in the rest of the DeFi market on Ethereum (not including staking pools) there is a constant withdrawal of ETH.
Sense of imminence by Ethereum 2.0 benefits staking pools
Ethereum is preparing for a transition where proof-of-work (PoW) mining will cease to exist on the network, giving way exclusively to proof-of-stake (PoS) staking.
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Currently, ETH is the most profitable cryptocurrency in mining with graphics cards (GPU). According to the portal WhattomineETH is 20% more profitable than its closest competitor.
With the transition from PoW to PoS, which is expected to happen this year with the merger («The Merge»), miners may have started to see staking as an option.
At the time of this publication, Ethereum 2.0 staking pools offer a return of around 4% per year for depositing ETH into their smart contracts.