Is the takeaway essentially that if the primary use case for ETH is earning yield from staking, it is destined to die? Is there a timescale on which other usecases need to ramp up for the network to become sustainable?
Dying can mean a lot of things. In my view, if the vast majority of eth becomes staked then it casts doubt on Ethereum's ability to act as the base layer for web3, but that doesn't necessarily mean the value will be low. Similarly, if we imagine a more Bitcoin-style PoS chain specializing in storing value then it might be natural for almost all coins to be staked, but that's not the use case that most of us are hoping for for Ethereum.
I don't think there's a strict deadline for other usecases. If fees stay low and the staking ratio rises over 50% then yields drop quite low (even with MEV) to a point where what's already on Ethereum should be able to meaningfully compete on a risk-adjusted basis. I think the staking ratio probably ends up between 30-50%, but ideally it would be lower, perhaps around that 30% barrier.
Is the takeaway essentially that if the primary use case for ETH is earning yield from staking, it is destined to die? Is there a timescale on which other usecases need to ramp up for the network to become sustainable?
Dying can mean a lot of things. In my view, if the vast majority of eth becomes staked then it casts doubt on Ethereum's ability to act as the base layer for web3, but that doesn't necessarily mean the value will be low. Similarly, if we imagine a more Bitcoin-style PoS chain specializing in storing value then it might be natural for almost all coins to be staked, but that's not the use case that most of us are hoping for for Ethereum.
I don't think there's a strict deadline for other usecases. If fees stay low and the staking ratio rises over 50% then yields drop quite low (even with MEV) to a point where what's already on Ethereum should be able to meaningfully compete on a risk-adjusted basis. I think the staking ratio probably ends up between 30-50%, but ideally it would be lower, perhaps around that 30% barrier.