Staked ETH

Definition ∞ Staked ETH refers to Ether (ETH) that has been deposited into the Ethereum 2.0 (now Ethereum Consensus Layer) smart contract to engage in the network’s proof-of-stake consensus mechanism. By staking ETH, holders become validators, assisting in securing the network and processing transactions. In exchange for their involvement, stakers receive rewards in the form of newly created ETH and transaction fees. This procedure is fundamental to Ethereum’s security and operation.
Context ∞ Staked ETH is a critical element of Ethereum’s post-merge security structure, significantly influencing network decentralization and economic stability. Discussions frequently concern the aggregation of staked ETH among large validators, the liquidity of staked assets through liquid staking derivatives, and potential regulatory ramifications for staking services. Future developments will likely involve sustained growth in staking participation, further advancements in liquid staking solutions, and ongoing protocol enhancements to improve validator efficiency and network resilience.