Ethereum Staking Hits New ATH

Ethereum (ETH) staking levels continue to break records, with the latest snapshot of the blockchain showing nearly 36.1 million ETH staked on the network – the highest level in history.

Will Price Follow?

According to a CryptoQuant Quicktake post by contributor XWIN Research Japan, close to one-third of Ethereum’s circulating supply is now staked. This high proportion suggests that ETH may be on the verge of a structural supply shock.

The following chart shared by the analyst shows that even during sharp corrections in 2022 and 2023, staking levels continued to climb. Unlike speculative flows, which often exit the market during downturns, staking activity has proven “sticky” – with investors choosing to lock ETH into the network rather than liquidate.

Key Implications of Staking ETH

Staking ETH carries several key implications:
1. Supply Compression: As more ETH is staked, less liquid supply remains on exchanges, creating a natural supply shock that amplifies demand-driven price moves.
2. Investor Priorities: By staking ETH, investors act as long-term participants, aligning their incentives with network security and yield instead of short-term trading.

ETH’s recent rally to $4,500 coincided with record staking levels, creating a feedback loop – higher prices attracted institutional inflows from custodians, exchange-traded funds (ETFs), and whales, while reduced liquid supply added further upward pressure.

ETH’s Institutional Transition

ETH ETFs now hold more than $300 billion in reserves, while asset managers such as BlackRock are actively accumulating. This underscores Ethereum’s transition from a speculative asset to a yield-bearing, institutionally supported infrastructure layer.

U.S.-based spot ETH ETFs have enjoyed a long streak of positive inflows from the week ending May 16 through August 15. XWIN Research Japan noted:
> Ethereum’s all-time-high staking levels reveal its underlying strength: while Bitcoin faces selling dominance, ETH is experiencing structural supply reduction. This highlights Ethereum’s growing role as the backbone of tokenization, DeFi, and RWA adoption.

Tom Lee, co-founder of Fundstrat Global Advisors, echoed these sentiments, stating that ETH is getting closer to becoming the backbone of global markets.

Risks Remain

Despite ATH in daily network transactions, ETH price is still lagging. The analyst mentioned that ETH is likely still in the accumulation phase. The recent pullback after creating a new ATH over $4,900 shows how recurring liquidation cycles shape ETH’s price action weekly. As of press time, ETH trades at $4,606, up 2.5% in the past 24 hours.

Charts from CryptoQuant and TradingView.com