Ether Is Likely Fixed-Income Hungry Institutions' Next Play

Ether Is Likely Fixed-Income Hungry Institutions’ Next Play

Ethereum recently executed its PoS transition successfully, increasing its scalability and cost-effectiveness. The development has allowed Ether to emerge as a probable fixed-income player among Hungry Institutions.

Several experts believe that staking yields investors can now pick Ether to gather massive institutional capital. However, the custodial and regulatory risks are still looming above the market.

The latest Ethereum Merge has allowed the network to eliminate its energy consumption needs majorly. Now, the network resembles fixed-income routines, which have always been a hallmark diversifier against stocks’ volatility.

BitOoda’s head of proof-of-stake, Vivek Raman, talked about the growing speculations. According to Vivek, validators can now earn a subsidy of approximately 4%. With the transaction fee set at 1.5% and the MEV (maximum extractable value) being 0.2%-0.5%, the aggregate staking yield can reach 6%.

Some even believe the yields can go even higher than 6% after the volume picks up. As financial institutions enter the blockchain market, they can add digital assets to their portfolios. It will naturally attract them to the largest, most stable, safest, and easiest yielding assets.

Many expect crypto-native institutions to be the first to start the adoption. Besides them, hedge funds and family offices will likely join the list. The adopters are most likely to be risk takers looking for quick profits. The stable yield is a bonus to reduce their risk marginally.

Passive asset managers and similar institutions are unlikely to be interested in crypto exposure. While the consensus surrounding crypto and blockchain is improving, a lack of regulatory authorities poses immense hurdles in its tracks.

Even the SEC and the CFTC have received a green flag from the Biden Administration to aggressively pursue investigations against unlawful activities in the digital assets domain. Thus, the crypto market must rapidly grow to eliminate such issues.


Charles Webber is a crypto journalist and copywriter who has a great passion for blockchain and Ethereum technology. He believes that decentralization empowers people to take charge of their lives, and gives back what we desired for a long time: financial freedom.

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