Since the Merge, stETH, Lido Finance’s tokenized form of staked Ether, has seen its annual percentage rate (APR) rise to an all-time high of 10.7%. According to data provided by Delphi Digital.
According to Dune Analytics statistics, the increase in APR represents a 159% increase since the Ethereum network switched to a proof-of-stake consensus process.
As to why there was a significant surge in stETH APR over the past few days, Lido Finance explained that it saw a hike in cumulative Lido MEV rewards, with a quantum of it being re-staked by validators on the platform.
MEV rewards going up and getting restaked by validators. More context here: https://t.co/Ujk50QrCFa
— Lido (@LidoFinance) November 14, 2022
stETH on the chain
Despite the rigmarole of FTX’s collapse and the consequential downturn in the wider cryptocurrency market, stETH has recorded lower sell-offs and increased accumulation since the beginning of the month. A look at the token’s exchange activity on Santiment revealed the same.
According to Santiment, stETH’s supply on exchanges was 17,987 stETH at press time. Since the month began, it has fallen by 68%. The consistent fall in the asset’s supply on exchanges indicated a decline in its distribution since the start of the month.
Conversely, its supply outside of exchanges has since hiked. With 487,390 stETH outside of exchanges at press time, this count has risen by 47% over the last seventeen days.
However, this failed to translate into any positive price appreciation for the asset. While stETH attempted a price rally between 1 November and 6 November, the unfortunate events that trailed the general cryptocurrency market due to FTX’s fallout led its price to drop significantly. Between 6 November and press time, stETH dropped by over 25% on the charts.
Apart from the statistically significant positive correlation that stETH shares with Bitcoin [BTC], on-chain data from Santiment revealed dormancy on the chain.
According to Santiment, the token’s Mean Coin Age and Mean Dollar Invested Age were spotted to be on 3-month-long uptrends. This showed that stETH investments remained dormant in wallets and did not change hands. This was a sign that there was stagnancy on stETH’s network, which typically makes it hard for the price of an asset to hike.