83% of Circulating SOL is Staked, With Native Staking Leading the Way

Solana is establishing itself as one of the industry’s most popular staking networks. Trust and belief in the ecosystem are sky-high, with stakers content to lock up their assets in native staking contracts to earn valuable rewards and secure Solana’s thriving network.

As confidence in the future of the Solana network grows, so too does the rate of staked SOL when compared to the token’s supply. 

Solana’s staking ratio now dominates that of Ethereum, with providers like Marinade Finance continuing to innovate the staking landscape and delivering competitive APY.

Solana Staking Ratio and APY Dominates Ethereum

Onchain data indicates that Solana’s staking ratio is vastly superior to that of its greatest Layer-1 rival, Ethereum. 

According to Dune Analytics data, 393.44M SOL is currently staked in various validators across the Solana blockchain. Taking into account Solana’s circulating supply of 469.75M and total supply of 586.75M, Solana’s staking ratio can be calculated at 83.75% and 67.07% respectively.

In contrast, Ethereum’s staking ratios are dramatically lower. Onchain data indicates that only 34.56M of ETH’s circulating supply of 120.39M is staked to the network, representing a mere 28.70% of ETH’s supply.

Additionally, Solana staking APY is significantly higher than Ethereum staking APY. While most Solana validators offer approximately 7-8% APY on staked SOL, Ethereum staking APY typically hovers around 3.5%. At first glance, this might seem favorable for Solana, but stakers also need to consider Solana’s inflation rate.

Solana’s inflation schedule is set to slowly diminish over time, dropping by 15% every year until it reaches 1.5%. Currently, Dune Analytics data suggests an annualized inflation rate of roughly 4.3%. 

Meanwhile, Ethereum’s inflation rate largely depends on network activity. Ultrasound Money data collected over the last 30 days indicates that Ethereum’s supply is projected to grow by 0.35% per year.

Subtracting issuance from validator APY reveals that leading Solana staking providers are still able to outperform both Solana’s inflation rate and Ethereum staking APY to deliver stakers some of the industry’s best-annualized rewards.

Through its novel Stake Auction Marketplace, Marinade Finance, one of Solana’s oldest DeFi protocols, delivers some of the most competitive staking APY in the Solana ecosystem. According to Marinade’s v2 dashboard, the network’s leading validators are offering up to 9.13% APY. 

Even after subtracting Solana’s 4.3% inflation rate, Marinade Finance continues to give depositors around 4.83% true APY when adjusted for inflation, making it one of the crypto’s most rewarding staking services.

Native Staking Popularity Grows on Marinade

Despite the rise of LSTs (Liquid Staking Tokens) throughout 2024, native staking remains the most popular method of staking SOL. At press time, 93.4% of staked SOL is staked natively.

Native staking is largely considered a smoother onramp for institutional funds, due to regulatory compliance and the lingering smart contract security concerns surrounding LSTs.

Following the launch of Marinade’s v2 staking platform, Solana stakers have steadily been reallocating stake to the protocol. 

Over the last 30 days, Marinade Native Staking TVL has increased by 6.2%, attracting an additional 154,000 SOL in deposits.

The growth of Marinade Finance’s native TVL suggests that depositors are willing to sacrifice the flexibility of LSTs in favor of native staking’s superior security and generous rewards. As Marinade continues its push towards 10% APY, more stakers are expected to flock to the protocol in search of the most competitive yield in the ecosystem.

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