Compass Investments

– The new all-time high is a major milestone in mining, especially after Ethereum’s transition from Proof-of-Work (PoW) to PoS in 2022, combining a basic level of mainnet execution with a new level of consensus.

This comes shortly after the recent Pectra update, which was the biggest hardfork since The Merge.

Amir Forouzani, co-founder of Puffer Labs, told The Defiant that Ethereum’s recent rate hike is due to two main reasons: the rise of liquid staking and increasing institutional participation.

yield derivatives, such as liquid staking tokens (LSTs) and liquid restocking tokens (LRTs), allow holders to keep their ETH liquid by using it in leverage and lending protocol looping strategies, increasing yields, Forouzani explained.

He added that the increased inflows from asset managers and likely exchange-traded fund (ETF) issuers underscores the growing confidence in ETH as a programmable yielding asset. Staking ETH yields vary by issuer but can range from 2% to around 4% , according to Staking Rewards.

Puffer Institutional alone has several clients poised to rebuild significant positions in ETH, and we expect overall staking to continue to grow as institutional adoption accelerates, he added.

Davis Richardson, managing partner at Paradox Public Relations, echoed this view, calling the new peak in betting a sign of “incredible confidence in the longevity of the Ethereum network”. “Even with the recent reshuffling of the senior management team and the emergence of ETH killers like Solana, Ethereum retains the largest number of developers and users on the network, Richardson said.

He emphasized that Ethereum has maintained its first mover advantage – and the market recognizes that. “In the short term, TVL may reduce selling pressure, especially as BlackRock reallocates the portfolio for its iShares ETH product and investors seek yields that bitcoin can’t offer right now, he added.

BlackRock, the world’s largest asset manager and issuer of the iShares Bitcoin Trust (IBIT) and iShares Ethereum Trust (ETHA) exchange-traded funds, caused a stir last week by selling bitcoin (BTC) and buying ETH.

According to Onchain Lens and Arkham data, BlackRock had floated about 5,362.37 BTC (worth about $561 million) and purchased more than $100 million of ETH by the end of the week. IBIT currently has $69 billion in net assets under management and ETHA has $3.77 billion.