- Institutional participation continued lifting Ethereum staking to record levels even as staking yields became increasingly dependent on token issuance rather than transaction fees.
- Protocol upgrades reduced transaction costs and expanded network capacity, allowing activity to grow while revenue across major chains declined.
- Avalanche and Solana demonstrated that stronger network usage does not necessarily translate into higher revenue when blockspace becomes significantly cheaper.
Activity across leading blockchain networks continued to strengthen during the second quarter despite falling cryptocurrency prices, with Ethereum, Solana and Avalanche becoming less expensive to use while processing more onchain activity.
According to the latest quarterly staking research by Bitwise, network revenues fell sharply even as usage increased because protocol upgrades expanded blockspace and reduced transaction costs. The report said weaker demand contributed in some cases but was not the main reason for the decline.
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Record ETH Staking Reshapes the Network
Ethereum recorded an all-time high of 40.2 million ETH staked, equivalent to about 33% of its total supply. Researchers found institutions accounted for most of the additional ETH entering the validator pool during the year, with growing participation from exchange-traded funds, corporate treasuries and other large holders.
The report also noted Ethereum’s annualised staking yield was 2.84%, compared with 6.25% for Solana, although most rewards on both networks came from newly issued tokens rather than transaction fees. It added that rising staking participation has reduced yields by spreading rewards across more participants.
Ethereum’s network revenue declined to approximately US$64 million (AU$92.8 million), while Solana’s real economic value fell to US$51 million (AU$73.95 million). Avalanche also experienced lower revenue despite transaction volume rising by about four times year-on-year following upgrades that significantly reduced transaction costs.
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