Binance Research: Ethereum's Switch to Staking Will Transform Industry

Binance's latest research report has argued that with Ethereum's pending switch to proof-of-stake, staking is set to have a major impact on the industry.

The report, published on Oct. 28, highlights that the largest 10 crypto assets supporting - or poised to support - staking represent a cumulative market capitalization of $25.8 billion.

As of press time, this means prospective staking dominance stands at roughly 10% of the total industry market capitalization.

As previously reported, staking is specific to Proof-of-Stake blockchains and essentially allows network participants to passively earn a form of "Interest" by depositing their tokens to both maintain the network and potentially earn rewards.

Ten largest crypto assets for staking, as of Oct. 2019.

Excluding Ethereum, the cumulative staking market capitalization, as of Oct. 24, is worth around $11.2 billion - $6.4 billion of which is staked.

Across all blockchains, Binance's data indicates that 43% of tokens are staked vs. 57% in free circulation.

Among coins listed on its platform, altcoins Algorand, Tezos, and Cosmos displayed high staking ratios - the ratio of the amount staked at a particular point in time divided by the total circulating supply - at over 70% of coins staked.

Tron and Qtum meanwhile exhibit a staking ratio of under 25%. Binance outlines the potential risk-return profile of staking as a passive investment strategy vs. active trading.

As reported yesterday, a senior ConsenSys executive has revealed that Ethereum 2.0 validators can expect to earn from 4.6% to 10.3% as rewards for staking on an annual basis.