70% of Institutional Ethereum Investors Engage in Staking

A recent report shows that almost 70% of institutional investors holding Ethereum (ETH) are involved in staking, with 52.6% of them using liquid staking tokens (LSTs).

About half of these investors rely on integrated platforms like Coinbase or Binance, while 60.6% also make use of third-party services.

The survey, which covered exchanges, custodians, investment firms, and banks, found that 20% of participants allocate more than 60% of their portfolios to LSTs based on Ethereum. When selecting staking service providers, investors prioritized factors such as reputation, network support, cost, ease of integration, scalability, and expertise.

Liquidity and security emerged as top concerns, with liquidity receiving an average importance score of 8.5 out of 10, while security was rated even higher at 9.4. Notably, 61.1% of respondents indicated a willingness to pay more for enhanced security, and the geographic distribution of validators was a key consideration for half of the participants.

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The growth of liquid staking has been fueled by the increasing popularity of LSTs, which improve liquidity by freeing up staked ETH. Lido Protocol leads this market, with 54.5% of respondents holding its LST, stETH. However, 78.4% expressed concerns about the potential centralization of validation power across different protocols.

Alexander Stefanov