Ethereum’s Reserve-Asset Case Persists as 36% of ETH Is Staked
Ethereum retains potential long-term value as a reserve asset, according to Blockworks analyst Jake Koch-Gallup, despite challenges to ETH’s value capture and its share of the stablecoin market. He argues that ETH’s valuation reflects not only realized economic value (REV), but also a premium tied to its reserve-asset and collateral roles. Its market capitalization is about 1,100 times its REV over the past 12 months.
Ethereum accounts for about 65% of DeFi total value locked and 45% of on-chain real-world asset value. Spot ETFs and corporate treasuries hold about 13% of ETH supply, while roughly 36% is staked. Koch-Gallup also says Layer 2 networks such as Base and Robinhood Chain, along with growth in the overall stablecoin market, could support the Ethereum ecosystem.
However, he cautions that relying on a reserve-asset premium may not sustainably support ETH’s valuation unless the network develops stronger revenue and value-return mechanisms.
Neutral
The analysis presents a mixed outlook for ETH rather than a new market-moving catalyst, supporting a neutral classification. The figures cited—about 36% of ETH supply staked, 13% held by spot ETFs and corporate treasuries, and large shares of DeFi and tokenized real-world assets—reinforce Ethereum’s role in the crypto market and may support long-term confidence. Growth in Layer 2 networks and stablecoins could also benefit the ecosystem.
In the short term, the article is unlikely by itself to trigger a sustained price move. Traders may focus more on ETH ETF flows, broader market direction, staking conditions, and network activity. In the longer term, the reserve-asset thesis could support demand if institutional holdings and ecosystem use continue to grow. But the valuation premium—market capitalization at about 1,100 times trailing 12-month REV—also highlights sensitivity to expectations. Without stronger revenue and mechanisms that return value to ETH holders, the premium could be questioned, particularly during risk-off periods. Similar arguments about network adoption and institutional demand have often bolstered long-term narratives, while price performance has still depended on actual cash flows, usage, and market liquidity.