Ethereum

United

<![CDATA[<figure class="image"><img src="https://cimg.co/news/123473/326538/ethereum-coin-media-libra.jpeg" srcset="https://cimg.co/news/123473/326538/responsive-images/ethereum-coin-media-libra___media_library_original_1200_800.jpeg 1200w, https://cimg.co/news/123473/326538/responsive-images/ethereum-coin-media-libra___media_library_original_900_600.jpeg 900w, https://cimg.co/news/123473/326538/responsive-images/ethereum-coin-media-libra___media_library_original_720_480.jpeg 720w, https://cimg.co/news/123473/326538/responsive-images/ethereum-coin-media-libra___media_library_original_600_400.jpeg 600w, https://cimg.co/news/123473/326538/responsive-images/ethereum-coin-media-libra___media_library_original_300_200.jpeg 300w" width="1200" class="content-img" alt=""><figcaption>Image Source: Adobe</figcaption></figure><a href="https://cryptonews.com/coins/ethereum/">Ethereum (ETH)</a>&nbsp;staking has been flourishing through protocols like Lido and&nbsp;<a href="https://cryptonews.com/reviews/coinbase/">Coinbase</a>'s staking service even as the value of DeFi assets continues to decline.Over the past year, the crypto sector has experienced a series of setbacks, including failures of centralized crypto exchanges and services, which has also led to capital outflows from the DeFi space.According to <a href="https://defillama.com">data from&nbsp;DefiLlama</a>, the total value locked (TVL) within DeFi protocols across various chains now stands at under $38 billion, a significant drop from the industry's peak in November 2021 when the TVL reached $178 billion.&nbsp;It is worth noting that the current TVL figure falls even below the total value locked shortly after the collapse of centralized exchange FTX in November 2022, which caused a two-year low in the assets locked within DeFi protocols.The market did witness a recovery in April, with the TVL rising back to approximately $50 billion.&nbsp;However, since then, the metric has retraced back to below $38 billion, even though the underlying crypto values have not experienced significant declines during this period.Meanwhile, the $38 billion figure does not include funds locked in liquid staking protocols like Lido.Since the collapse of FTX, Lido has <a href="https://cryptonews.com/news/demand-for-eth-staking-soars-despite-nearly-month-long-waiting-period.htm">seen a substantial increase</a> in its TVL from $6 billion to $13.95 billion.According to DeFiLlama, these protocols "deposit into another protocol," which explains why they are not included in the total TVL tally.&nbsp;Likewise, Coinbase's staking service, launched in September 2022, has accumulated an additional $2.1 billion worth of Ethereum, bringing the total assets held by such services to $20.2 billion.Liquid staking allows investors to stake their assets and earn yield while still enjoying trading liquidity through pegged assets issued by the staking provider, such as cbETH and stETH.&nbsp;This alternative can be more attractive to investors than using lending protocols like Aave, which require users to lock their tokens and potentially expose themselves to unwanted protocol risks.&nbsp;As of now, Aave's ETH and USDC yield rates are 1.63% and 2.43%, respectively, compared to Coinbase's more lucrative rates of 3.65% for ETH and 4.5% for USDC.Meanwhile, the decline in the TVL of several DeFi platforms over the past month is also worth noting.&nbsp;Aave's TVL has fallen by 21% to $4.5 billion, while Curve Finance has experienced a 26% decline to $2.3 billion.&nbsp;One potential factor contributing to this decline could be the hawkish monetary policy of the United States Federal Reserve.&nbsp;This policy has resulted in higher yields on short-term government debt, making it a more attractive option for investors compared to stablecoin yields within the DeFi space.
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Ethereum Staking Flourishes While Value of DeFi Assets Shrinks – What's Going On?

Cryptonews.com

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