HashKey Capital: The Ethereum LSD protocol is expected to increase TVL by $24 billion in two years

ChainCatcher news, according to HashKey Capital's latest report, the liquid staking derivatives (LSD) market for Ethereum is expected to experience explosive growth in the next two years, with the total value locked (TVL) potentially increasing by $24 billion. The report notes that this year, the total value locked (TVL) in Ethereum's LSD market has exceeded $22 billion, with the total market capitalization of all LSD projects reaching $18 billion. The report predicts that by the end of Q2 2025, the amount of staked Ethereum could account for 31%-45% of the total Ethereum supply, which will drive up the value of the LSD market.

Although HashKey Capital predicts that staking yields may decrease due to increased investor participation, the report also points out that this impact can be mitigated due to the composability of decentralized finance (DeFi) protocols. For example, staked assets can also be used to generate yield farms, lending, or other income-generating DeFi strategies, creating a layered yield generation structure that could effectively offset the anticipated decrease in staking yields.