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Ether Inflow Surge: Binance Staking Vaults Collect $573M in September

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Sep 20, 2023 at 10:26 am

In just a span of two days, a significant surge of capital poured in, leading to a noteworthy increase in the Total Value Locked (TVL) of Binance's staked ether.

Based on DefiLlama's data, Binance's staked ether token, known as BETH, saw a surge in deposits earlier this month. This propelled the TVL to an impressive $731 million, representing a more than fourfold increase.

This staking token was introduced by the exchange in April, aligning with the Ethereum blockchain's transition to a proof-of-stake network. Previously, the TVL had fluctuated between $120 million and $170 million. However, on September 1st, there was a substantial inflow of $165 million from two transactions, followed by a single transaction of $243 million two weeks later. Aside from these instances, daily inflows never exceeded $500,000.

Liquid staking tokens are essentially derivative assets acquired by staking ether (ETH) on platforms like Lido, Coinbase, or Binance. In exchange, stakers have the opportunity to earn a yield while still retaining an asset that can be utilized elsewhere within the decentralized finance (DeFi) ecosystem.

Data from Etherscan indicates that the four largest holders of BETH are wallets controlled by Binance. This implies that the exchange may be mirroring its users' transactions on the blockchain.

While BETH's TVL may seem relatively modest in comparison to bigger players like Lido staked ether with $14 billion, and Coinbase with $2 billion, the sporadic surges in inflows suggest that a specific entity or trader is placing significant trust in Binance, despite the regulatory uncertainties surrounding the crypto exchange.

Presently, Lido offers a 3.6% Annual Percentage Yield (APY) on staked ether, which is notably higher than BETH's 3.25%. The reasoning behind choosing to stake on Binance rather than a decentralized alternative like Lido remains unclear. Binance has not yet responded to Bitsday's request for comment.

Read more: Web3 Ventures: Sino Global, Coinbase, and Libra Veterans Launch $60 Million Fund

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