Staking validators in potential crisis says ecosystem report by Staking Rewards

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Staking Rewards, the leading data aggregator for the staking industry, has compiled a comprehensive report armed with proprietary survey insights from over 1,700 crypto users and 30 market-leading validator entities,

high-profile speaker panel insights from their Staking Summit and a wealth of streamlined raw validator data accessible via the Staking Rewards API.

The resulting 11,000-word report features 42 graphs and offers insights that are hard to find elsewhere.

The report explores concerns and innovations around decentralization, delves deep into users’ approaches to selecting protocols and their thoughts on staking, and provides unfiltered insights from validator operators who are sounding the alarm on their industry.

Mirko Schmiedl, Co-Founder and CEO of Staking Rewards, commented on a key insight from the report, “Validators are potentially facing existential challenges that threaten not only their business but also the entire decentralization ethos of blockchains.”

Challenges are many, and if you’re an investor, read this report to understand the crucial role of delegating your tokens. If you’re a validator or thinking of becoming one, read the report to see what’s lurking ahead and learn how to weather the storms ahead from industry veterans.

Insiders in the report discuss the consequences of larger validator actions, increasing the risk of centralization. Insiders claim larger validators can afford to undercut commission fees to increase AUM. As a result, larger competitors have more revenue overall, more runway to build better infrastructure, and more voting power over protocols – a serious threat to decentralization.

To overcome these challenges for business continuity and increasing decentralization, industry operators recommend smaller validators to focus on alternative revenue streams, offer

value-added products and services, and implement new technologies such as liquid staking, MEV capture advancements, and decentralized validator technology (DVT).

Mr. Schmiedl adds, “Our report concludes many insiders believe regulatory clarity is coming in 2023, which will propagate not only institutional interest but also action. As institutions join the space, we anticipate that they will also consider running validators, further helping counter a key issue in PoS, centralization.”

Despite headwinds, users and validator operators remain bullish on the future of crypto and discuss several positive narratives in the State of Staking 2022 report. Further, Staking Rewards overviews five key catalysts it’s observing in 2023.

Staking Rewards is committed to advancing the long-term success of PoS protocols and enabling investors and validators to achieve their goals. The insights provided in the 2022 Staking Ecosystem Report will help drive the industry forward and support its continued growth.

The full Staking Ecosystem Report can we found under the following link from 19th December 2022, 10am UTC onwards:

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