Ethereum (ETH) Analysis: Factors Behind the Decline in Demand
Ethereum's Slowdown and Its Impacts
Ethereum (ETH) has witnessed a noticeable decline in demand over the past few months, influenced by a slowdown in blockchain activity. The reduction in the Ether burn rate has contributed to an increased circulating supply, influencing price dynamics. In their latest report, 10X Research points to several critical factors responsible for this trend.
Falling Staking Yields
According to 10X Research, one major element affecting Ethereum (ETH) is the decline in staking yields. The Annual Percentage Rate (APR) for stakers on Lido, Ethereum's largest staking provider, has been on a downward trajectory since August, currently standing at 2.90%. This trend indicates that staking on Ethereum is viewed more as a modest income source than as a means for extensive ecosystem engagement.
Competition from Alternative Chains
Moreover, the rise of low-cost meme tokens on blockchains such as Solana has drawn attention away from Ethereum. As investors seek better short-term returns, many ETH holders now reconsider their staking strategies. Alongside this, traditional finance options offering higher yields have made Ethereum staking less attractive.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.