The ETH has recently attracted a lot of media attention. According to one of the project’s co-founders, Joseph Lubin, the market is experiencing a paradigm shift. The upcoming 2.0 upgrade from Ethereum is also fueling network-related expectations.

Additionally, there is another emerging trend in the Ethereum market right now that caught a lot of attention by the end of the year.

Recently, many market participants have started “pinning” their cryptocurrencies in order to earn percentage rewards over time. According to one report from JP Morgan, staking generates about $ 9 billion a year for the crypto industry. The report’s authors also claim that the transition from Ethereum to PoS will continue to fuel the aforementioned trend, which is projected to exceed $ 40 billion by 2025.

“Staking not only reduces the opportunity costs of holding crypto compared to other asset classes, but in many cases, crypto also pays out a significant amount of real and nominal returns.”

Source: staking rewards

According to StakingRewards, the stake value of Ethereum 2.0 at the time of writing is $ 12.9 billion. Accordingly, the annual return is 6.15%. In particular, staking other cryptocurrencies such as SOL, BNB, ADA and DOT achieves annual returns of 4% up to 13.27%.

The JP Morgan report also claims that as the volatility of cryptocurrencies decreases, the ability to make actual profits will help the market become more mainstream. At this point it should be noted that the imminent maturity of the Ethereum network could reduce the volatility of Ether in the future.

The report also states:

“Returns generated by staking can minimize the opportunity costs of owning cryptocurrencies compared to other investments in asset classes such as the US dollar, US government bonds or market funds. Currencies in which investments generate a positive nominal return. “

ETH options monthly volume | Source: The Block Research

However, at the time of writing, the ETH indicators don’t seem all too healthy. Specifically, the monthly option volume fell significantly by 66.8% in June, while the volume of ETH futures contracts almost halved in the same period (–49.3%).

ETH Futures monthly volume | Source: Lars

In addition, the total adjusted volume of ETH has also decreased by $ 386 billion.

Adjusted on-chain volume of BTC (green) and ETH (pink) | Source: Lars

Currently, staking is gradually being enthusiastically received by market participants. Accordingly, they can earn passive income by holding cryptocurrency. If this popular trend continues to spread, investors will likely buy more ETH after the 2.0 upgrade. In short, staking can rebound the ETH price and improve the health of ailing indices.

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