Track market-moving stories before they get noisy

Ether.fi [ETHFI] has been on the higher side in the past, delivering an 18% gain, with the asset now on a 90-day streak of roughly 5.3% performance for the first time in a while.

The performance is closely linked to the on-chain market outlook, which shows there has been growing usage of the protocol, especially through fee generation and activity.

On-chain activity supports ETHFI’s growth
The clearest indication of growing usage of the protocol comes from its performance, which shows that users remain active.

The protocol’s fees have surged on a week-on-week basis to their highest level since the week starting June 1. Fees have reached $2.8 million, up from a low of $2.39 million for the week between June 22 and 28.

Higher fee generation points to growing activity on the protocol, with annualized revenue reaching over $50.56 million and revenue over the last 30 days standing at $2.93 million.

Source: DeFiLlama
The total value locked also shows steady growth, indicating that investors continue to deposit and lock their assets on the platform for long-term price performance and yield.

During the week between June 22 and 28, when fees dropped to their recent low, TVL also surged at the time of writing, rising from $2.83 billion to $3.532 billion, an increase of roughly $702 million.

On a short-term scale, the growth remains visible, with the protocol’s TVL growing by $74 million between August 11 and the time of writing.

Liquidation heatmap points to a possible pullback
The liquidation heatmap analysis shows there is potential for the price to witness a local swing based on the cluster level.

The liquidation cluster on the chart shows a dense concentration of liquidity at the higher part of the chart. This local level is around $0.45, with roughly $180,000 worth of orders at this level.

Source: CoinGlass
Clusters tend to act as magnets, pulling price toward them. In this case, with the cluster positioned above the price, it represents a sell cluster. When price trades into this zone, a pullback could occur.

For now, the setup shows a rally-to-retracement narrative. Notably, continued capital inflows, especially through on-chain flows, could strengthen accumulation, outweigh sell pressure at this level, and push ETHFI higher.

ETHFI buybacks remain at zero in Q3
One major concern over whether ETHFI can sustain its run is its buyback activity. Token buybacks allow teams to reduce the circulating supply of their tokens, which can affect price dynamics positively.

For Q3, there has been no token buyback, with $0 spent so far. This stands in sharp contrast to previous quarters, such as Q2 and Q1, when $30,000 and $3.28 million were spent, respectively.

Source: DeFiLlama

Ether.fi’s buyback program is designed to use part of protocol revenue to buy ETHFI.

For now, token holder data shows that buying activity remains in the market, with the number of token holders climbing to 131,940 on the chart. This implies that demand for the token remains present despite the lack of recent buyback spending.

With little incentive from buybacks, the analysis shows that holders in the market are more hinged on the protocol’s performance as a whole.

Final Summary

Rising fees and TVL point to growing activity on Ether.fi, while token holders have also climbed to 131,940.
ETHFI faces potential sell pressure near $0.45, with no buyback spending recorded in Q3 so far.

Mike Silagadze, CEO and co-founder of liquid restaking protocol ether.fi, has put his money where his governance opinions are. On August 7, 2026, Silagadze publicly offered a $1 million bet that EIP-8363, a draft Ethereum Improvement Proposal for tapered validator reward burning, will increase network concentration among validators if adopted.

What EIP-8363 actually does EIP-8363, titled “Tapered Issuance Burn,” was submitted on August 4, 2026. Its authors include Justin Drake, a prominent researcher at the Ethereum Foundation. The core mechanic is straightforward in concept: partially burn validator rewards at a rate that scales with the total amount of ETH staked across the network.

The burn formula scales as the effective staking balance divided by 60.25 million ETH, raised to the power of 1.5, and capped at 100%. In practical terms, as the amount of staked ETH approaches roughly 50% of the total supply (around 60.25 million ETH), performing validators would reach net zero issuance. Their rewards would be entirely burned.

Currently, about 41.5 million ETH is staked, representing roughly 34% of the total supply, with yields hovering around 2.67%. The proposal’s most aggressive effects would only kick in as staking climbs toward that 60.25 million ETH threshold.

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Why Silagadze thinks it’s a centralization bomb Silagadze’s argument centers on a simple economic asymmetry. Solo stakers and smaller node operators have real capital costs. They buy ETH at market price, lock it up, and earn yield as compensation for that opportunity cost. When yields get compressed by a tapered burn, their incentive to participate erodes quickly.

Large custodians like Coinbase and Binance operate under entirely different economics. They hold massive pools of customer ETH that they can deploy for staking at effectively zero marginal cost of capital. Even with dramatically lower yields, staking remains profitable for them because their cost basis is fundamentally different. The result, in Silagadze’s view, is predictable: solo stakers exit, large custodians stay, and the validator set consolidates around a handful of centralized entities.

Stani Kulechov, CEO of Aave, has also raised concerns about EIP-8363’s downstream effects. Kulechov’s critique focuses on DeFi collateral markets that depend on staking yields. Liquid staking tokens like stETH and eETH serve as collateral across lending protocols. Compress the yield those tokens generate, and you potentially undermine the economic foundation of a significant portion of DeFi.

The community response has been unusually decisive Polling conducted by the Ethereum Validators Association tells a stark story. A survey of validators found 99.77% of respondents opposing EIP-8363.

The proposal remains in draft form with no immediate plans for inclusion in any upcoming hard fork. Supporters of the proposal argue that unchecked staking growth creates its own centralization risks and security vulnerabilities, and that if too much ETH is locked in staking, it could reduce the liquidity available for economic activity on the network. The tapered burn, in this framing, acts as a pressure valve.

What’s at stake beyond the bet Ethereum’s staking ratio has been climbing steadily. At 34% of supply staked, the network is still well below the 50% threshold where EIP-8363’s burn mechanism would reach full force.

For DeFi protocols, liquid staking derivatives are deeply integrated into lending, borrowing, and leverage markets. Any material change to staking economics ripples through the entire composability stack. A protocol like Aave, which holds significant positions in staked ETH derivatives as collateral, has direct financial exposure to these policy decisions.

The $1 million bet remains open. Whether anyone takes the other side may say as much about the proposal’s prospects as the formal governance process itself.

Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.