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Validators generated a total revenue of $46 million during the first week of May due to the rise in the staking rewards rate, which serves as an indicator of the annualized yield for validators. Data indicates that validators received 24,997 Ether (ETH) that week, reflecting a 40% increase compared to the prior week’s earnings of $33 million, when 18,339 ETH were allocated as rewards.
The recent popularity of a new memecoin named Pepe is the reason for the validators’ appreciation. Over the past week, the average fees on the Ethereum network have surpassed 100 gwei, reaching the highest point since May 2022. As gas fees rise, end users are incurring costs of over $30 per swap. This increase in gas fees has led to greater fee income for validators from transaction processing, in addition to their standard validator rewards.
ETH staking rewards reference rate. Source: Beaconcha.in
According to Beaconcha.in, the current staking rate represents the expected annualized return for validators. To participate in the network’s consensus process, Ethereum validators are required to stake a minimum of 32 ETH, which is approximately valued at $58,000.
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Since Ethereum transitioned to a proof-of-stake (PoS) consensus mechanism with The Merge last year, and following the recent Shapella upgrade that allowed validator withdrawals for the first time, ETH staking has become increasingly significant among institutional investors.
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