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Author
Daniel Mensah
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2 Minutes
50Fish via stocksnap

Ethereum staking ratio passes 28 percent and the float keeps shrinking

More than a quarter of supply is locked. That changes the liquidity profile in ways the price does not immediately show.

The share of ether supply committed to staking passed 28 percent, continuing a rise that has been almost uninterrupted since withdrawals were enabled.

Staked ether is not permanently locked, but it is not immediately available either. Exiting is subject to a queue that lengthens as more validators try to leave at once, which means the effective free float is smaller than the nominal supply.

Why a shrinking float matters

A smaller float means a given amount of buying or selling moves the price further. That cuts in both directions and it raises realised volatility relative to what the flow alone would suggest.

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About the author

Daniel Mensah

Digital assets

Daniel covers crypto market structure, regulation and flows. He is more interested in plumbing than in price predictions, on the grounds that the plumbing is what actually breaks.

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