Summary
TLDR: Lido and Coinbase’s large Ethereum stakes pose concentration risks, but potential ether staking ETFs in the U.S. could mitigate this by using institutional custodians and diversifying stakes across multiple entities, according to S&P analysts.
Key Points
1. Lido and Coinbase are the largest Ethereum validators, with Lido holding just under 33% stake and Coinbase holding 15% stake.
2. There is a potential concentration risk posed by these large validators, but this risk may be reduced by the introduction of potential ether staking ETFs in the U.S.
3. The potential ether staking ETFs may opt for institutional custodians and diversify stakes across multiple entities, helping to mitigate concentration risks in the Ethereum network.