Key Points
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Ethereum’s points production fell below 3%, leaving it behind many DEFI and RWA protocols.
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Load-bearing stable proteins like Susde and Sumrumpusdc now offer 4-6.5% returns and are quickly gaining market share.
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Most competing production products are built on Ethereum, which means that rising adoption rates can still enhance the value of the network over time.
Fixed income is no longer only applicable to tradfi. OnChain production has become the core pillar of cryptocurrencies, and the largest listed blockchain Ethereum is at the center. Its economy relies on users to lock their ETH (eth) To help secure the network and get a rate of return.
However, Ethereum isn’t the only game in town. Today, crypto users have access to an increasing number of content products, some of which directly compete with Ethereum’s stacked returns, which may weaken blockchain. The stability of load-bearing stability provides greater flexibility and impact on traditional finance, with returns associated with U.S. Treasury and synthetic strategies.
Meanwhile, the Defi loan program expands the scope of assets and risk profiles available to depositors. Both usually offer higher yields than Ethereum’s possessions, which raises a key question: Is Ethereum quietly losing the output war?
Ethereum’s shareholding output declines
Ethereum’s points production is the return that ensures the network’s validators get. It comes from two sources: consensus rewards and execution layer rewards.
Consensus rewards are issued by the agreement and depend on the total number of ETHs. The more fixed ETHs are across the network, the lower the rewards are for each validator through design. The formula follows an anti-square root curve, with the return on more capital entering the system decreases. Execution layer rewards include priority fees (the transactions paid by the user are included in the block) and MEV (maximum extractable value), which are the additional profits obtained from optimized transaction ordering. These additional rewards fluctuate based on network usage and validator policies.
Since the merger in September 2022, Ethereum’s points production has gradually declined. From about 5.3% at the peak, the total rate of return (including consensus rewards and tips) is now below 3%, reflecting a fixed growth in total ETH and a mature network. Indeed, it’s over 35 million ETHor 28% of its total supply, is now fixed at.
However, only solo validators can achieve full fixed income, while those who run their own nodes and lock 32 ETH. When they retain 100% of the rewards, they also assume the responsibility of staying online, maintaining the hardware and avoiding penalties. Most users choose more convenient options, such as Lido’s liquid placement protocol or custodial services provided by the exchange. These platforms simplify access, but charges (usually between 10% and 25%) further reduce the ultimate rate of return users receive.
While Ethereum’s production seems moderate in years of less than 3% of its age, it still compares to its closest competitors. Solanathe current average network APY is located at 2.5% (up to 7% network APY). In fact, Ethereum’s production looks better: its network inflation Compared to Solana’s 4.5%, it’s only 0.7%, which means that Stakers on Ethereum will face a smaller dilution rate over time. But Ethereum’s main challenge is not other blockchains, but the rise of alternative yield protocols.
Stable load-bearing stable gains market share
Load-bearing stabilizers allow users to hold one dollar of assets while earning passive income, usually from U.S. Treasury bills or synthetic strategies. Unlike traditional Stablecoins, such as USDC or USDT, these new tools allocate a portion of their underlying benefits.
The five largest load-bearing stable stable proteins (Susde, Susds, Sumrumpusdc, Usdy and OUSG) will exceed 70% of the $11.4 billion market and use different methods to generate yields.
Offered by Blackstone-backed company Ethena, Susde relies on a synthetic delta neutral strategy involving ETH derivatives and points rewards. It offers some of the highest yields in cryptocurrencies, with historical rates ranging from 10% to 25%. Although the current yield drops to around 6%, Susde still outperforms most competitors, although the risk is higher due to its complexity, market-dependent strategies.
SUSD developed by Reflexer and Sky (Ex-Makerdao) is powered by SDAI and RWAS (marking assets in the real world). Its yield is more conservative, currently at 4.5%, focusing on decentralization and risk reduction.
The syrup DC pathway issued by Maple Finance is generated through tokenized monuments and MEV strategies. It offers double-digit returns at launch, but now produces 6.5%, which is still higher than most centralized alternatives.
Usdy, issued by Ondo Finance, will rule the short-term Treasury with a 4.3% return targeting institutions with a regulatory, low-risk situation. OUSG is also from Ondo, backed by Blackrock’s short-term fiscal ETF, with production of around 4%, with full KYC requirements and strong compliance.
The main differences between these products are their collateral (synthetic vs. real world), risk profile and accessibility. Susde, Sumrumpusdc and Susds are fully adaptable and licenseless, while USDY and OUSG require KYC and cater to institutional users.
Stablers with stable load bearing are quickly gaining attention, combining the stability of the dollar with the profit opportunities that were once reserved for institutions. The industry has grown 235% over the past year, and there has been no sign of slowing as demand for Onchain fixed income continues to grow.
Related: Tradfi’s deep liquidity problem is the risk of cryptocurrency’s silent structure
Defi loans are still concentrated on Ethereum
Decentralized lending platforms such as AAVE, Compounds and Morpho allow users to earn yields by providing crypto assets to their lending pools. These protocols set up algorithms based on supply and demand. As borrowing demand rises, so does interest rates, making Defi loans more dynamic and often not related to traditional markets.
The ChainLink Defi Earnings Index tracks average loan returns on major platforms, showing that stable loan rates typically hover at about 5% of USDC and 3.8% of USDT. When borrowing demand soars, gains tend to soar during bull markets or speculative madness.
Defi loans are market-driven compared to banks based on central bank policies and credit risk-adjusted rates. This creates opportunities for higher returns, but also puts lending on unique risks such as smart contract errors, Oracle failures, price manipulation and liquidity tightening.
Paradoxically, however, many of these products are built on Ethereum itself. Load-bearing stabilizers, tokenized monuments and Defi lending schemes rely heavily on Ethereum’s infrastructure, in some cases, to incorporate ETH directly into its production strategy.
Ethereum still exists The most trustworthy blockchain Among traditional and crypto-local financial participants, it continues to lead hosting Defi and RWAS. As these departments gain adoption, they can increase network usage, increase transaction fees, and indirectly enhance the long-term value of ETH. In that sense, Ethereum may not lose the war of surrender – it may just be winning in a different way.
This article does not contain investment advice or advice. Every investment and trading move involves risks and readers should conduct their own research when making decisions.
