Corporations are increasingly turning to Ethereum staking to generate passive income, which is narrowing the amount of Ether available for sale on the open market.
BitMine Immersion Technologies, the largest corporate holder of Ether (ETH), staked 342,560 ETH worth over $1 billion in the two days leading up to Sunday, According to to the Lookonchain blockchain data platform.
Staking involves locking ETH on the Ethereum proof-of-stake network to secure the blockchain in exchange for a passive annual rate of return (APY) of around 3-5%.
BitMine’s $1 billion worth of staked Ether also significantly impacted the Ethereum validator queue, with the input queue growing almost twice as gigantic as the output queue for the first time in over six months, Cointelegraph reported earlier on Monday.
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The queue to enter the validator is 12 days and 20 hours, with 739,824 ETH waiting for staking, while the exit queue was 6 days and two hours, with 349,867 ETH waiting for withdrawal, according to validator queue.
The queue shows that almost twice as many entities are willing to stake ETH for passive income compared to validators waiting to withdraw their stakes, signaling greater long-term confidence in Ether.
When the exit queue is larger, it signals that validators are looking to withdraw their Ether, potentially preparing to sell their shares.
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Corporate treasuries are hunting for ether profits
Most leading corporate Ether holders invest a gigantic portion of their ETH for passive income, including SharpLink Gaming, Bit Digital, and The Ether Machine, among others.
SharpLink Gaming, the second largest holder of Ether, he said according to the company, it staked “almost all” of its Ether holdings and generated a total of 9,701 Ether worth $29 million in staking rewards panel.
The Ether Machine, the third-largest holder of $1.49 billion in Ether, has “fully staked” its onchain vault and consistently ranks among the top 5% of validators in reward staking efficiency, the company announced in October.
The increasing amount of staked ETH effectively reduces the supply of Ether, which is seen as a net positive for the long-term value enhance of the second-largest cryptocurrency.
Despite the growing amount of ETH staked, the industry’s most successful traders in terms of returns, who are tracked as “smart money” traders on Nansen’s blockchain intelligence platform, continue to reduce their spot Ether holdings.
According to the data, Clever Money Traders sold a total of $4.26 million worth of Ether spot tokens across 53 wallets last week, but whale wallets bought a total of $11.6 million during the same period. Nansen.
Public figures also bought nearly $6 million worth of spot Ether, while up-to-date wallets bought over $517,000 over the past week, signaling demand for Ether from cryptocurrency investors with newly created wallets.
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