Staked Ethereum

Definition ∞ Staked Ethereum refers to Ether (ETH) tokens that are locked up in the Ethereum network’s proof-of-stake consensus mechanism to secure the blockchain. Participants, known as validators, commit their ETH to support network operations, process transactions, and create new blocks. In return for their contribution, validators receive rewards in ETH, incentivizing their honest participation and the network’s security. Staking is a fundamental component of Ethereum’s transition to a more energy-efficient and scalable consensus algorithm.
Context ∞ Staked Ethereum is a major topic in crypto news, particularly following the network’s transition to Proof-of-Stake, which significantly altered its economic model. Discussions often center on the growing amount of ETH locked in staking, the yields offered to validators, and the implications for network decentralization. The liquid staking derivatives market also represents a significant development, allowing users to maintain liquidity while participating in staking.