Institutional Ethereum Staking Jumps; Lido Market Share Falls

Institutional staking of Ethereum grew in the first half of 2026 as institutions increased their share of total staked ETH from 25.9% to 35.3%. Over the same period, Lido’s share of the staking market declined from 23.93% to 21.18%.

The Ethereum staking pool expanded from 36.3 million ETH on Jan. 1 to 43.1 million ETH by June 30, an increase of about 6.8 million ETH. Lido added 386,000 ETH in H1 and held about 9.13 million ETH as of June 30.

Lido’s H1 operating report attributes part of the dilution to institutional flows moving into other staking routes. At midyear the report listed other large positions: Bitmine at 11.5%, Coinbase at 10.9% and Binance at 7.9%. The report also lists Grayscale at 3.1% with that exposure routed via Coinbase, which creates overlap between custody and staking figures.

Product terms affected where institutional capital landed. Lido offers staking vaults called stVaults and temporarily waived an infrastructure fee for qualifying operators with more than 250 ETH through Oct. 31. Lido announced on Aug. 13 that Sharplink planned to deploy $200 million of ETH through Lido, with wrapped stETH held at Anchorage Digital, illustrating a custody-and-staking arrangement that can carry different fee terms.

Lido’s unaudited H1 accounts reported $27.51 million in gross staking revenue after rewards to stETH holders and $15.71 million in net staking revenue after deductions. Total net DAO revenue, including other products, was $15.94 million. The report gave an effective DAO share of staking rewards of 6.15% at period end, up from 4.96% in December, while the protocol fee remained set at 10%.

Foundation expenses of $14.33 million were recorded in H1. A $6.06 million one-off related to Kelp contributed to a $4.45 million total loss for the period in the unaudited accounts. On-chain dashboard snapshots at a Sept. 9 checkpoint showed Lido revenue of about $101,935 over 24 hours, $696,955 over seven days and $2.71 million over 30 days.

Lido’s automated buyback mechanism, NEST, follows specific on-chain accounting rules. Under implemented rules, NEST subtracts a daily reserve of roughly $109,589 and applies a 50% surplus share to a signed cumulative budget. When that cumulative budget is negative, later surplus must rebuild it before allocations resume. NEST also enforces caps of $50,000 in allocations per day and $10 million per fixed 365-day window.

At 00:00 UTC on Sept. 9 the contract that releases funds for purchases recorded a negative cumulative budget of about $517,024 and skipped an allocation. Blockscout transfer records showed a single funding transfer of 41 stETH into the allocator on Aug. 28 and no outbound allocation transfer as of the Sept. 9 snapshot. Separately, Lido completed discretionary buybacks, acquiring 10,025,866 LDO for 1,591 stETH under a separate program; those discretionary purchases sent acquired tokens to the DAO treasury.

Operational conditions on Ethereum also affect staking economics. A Sept. 9 validator queue snapshot showed about 1,931,206 ETH waiting to activate, with an estimated delay of roughly 33 days and an annualized network reward rate near 2.59%. Lido’s consolidation guidance allows source stake to keep earning while target validators in stVaults await activation, subject to deposit and transfer delays.

The H1 report included a simple sensitivity example: an additional 100,000 ETH becoming active at a 2.59% reward rate and paying the DAO 6.15% of those rewards would generate about 159 ETH in annual DAO staking revenue, roughly $398,000 at an assumed ETH price of $2,500. Actual revenue depends on the amount of active stake that reaches Lido on paying terms, reward rates, ETH’s dollar price and fee terms that determine the DAO’s retained share.

The Sept. 9 checkpoint showed a larger staking market and rising institutional participation alongside a buyback mechanism that required on-chain surplus and eligibility conditions before allocations could be executed.