Restaking Rush Fizzles Out as Top Protocols Struggle with Meager Profits

The restaking gold rush, which saw many cryptocurrency protocols scrambling to attract validators and secure lucrative rewards, has come to an end. In a recent analysis, top protocols have been found to barely be making a profit from their staking activities.

According to CoinDesk's research, the average revenue per validator for leading protocols such as Ethereum (ETH) and Tezos (XTZ) is around $1 million to $2 million per year. However, this figure is significantly lower than what was expected during the peak of the restaking gold rush.

During this period, some top validators were reportedly earning up to $10 million or more per year from staking rewards alone.

The decline in revenue can be attributed to a combination of factors, including increased competition among protocols and a decrease in staking yields. Additionally, the cost of running a validator has also risen significantly, further eroding profit margins.