Ethereum, Solana and Avalanche got cheaper and busier as their tokens halved, Bitwise says

Blockchain usage rose and transaction costs fell across Ethereum, Solana and Avalanche over the past year — while ETH, SOL and AVAX each lost roughly half their value or more, according to Bitwise's first quarterly staking report, discussed by the asset manager's Head of Onchain Research Kam Benbrik on The Block's The Starting Block podcast on Monday.

Benbrik framed it as a split between fundamentals and price: "blockchains are becoming cheaper, and second, onchain activity is actually increasing," he said, even as "prices are down compared to 2025." Bitwise attributes falling network revenue mostly to design choices — networks deliberately making blockspace "cheaper and more abundant" — rather than collapsing demand, though it conceded "weaker demand played a part in some cases."

The report also flags how thin the headline staking yields are once you look at where they come from. Bitwise puts Ethereum's Q2 annualized staking yield at 2.84% and Solana's at 6.25% — but says newly issued tokens funded 93% of Ethereum's staking rewards and more than 90% of Solana's. In other words, most of the "yield" is dilution paid to stakers by non-stakers, not fees from actual usage. By that logic, holders who don't stake are effectively diluted, and as participation climbs, the same issuance is spread thinner and yields drift lower.

Staking is increasingly an institutional affair. Bitwise says ETFs, corporate treasuries and other large holders drove most of the ETH added to the validator set this year, with a record 40.2 million ETH — about a third of supply — staked at the end of Q2. As a live example, the report notes Bitmine, the largest ETH treasury, said Monday it was staking more than 4.9 million of its roughly 5.8 million ETH.

Key facts

• ETH, SOL and AVAX each down ~50%+ year-over-year (Bitwise, via The Block).
• Q2 annualized staking yield: 2.84% ETH, 6.25% SOL (Bitwise Q2 report).
• Issuance funded 93% of ETH staking rewards, 90%+ of SOL's (Bitwise).
• Record 40.2M ETH (~⅓ of supply) staked at end of Q2 (Bitwise).
• Bitmine staking 4.9M of ~5.8M ETH held (Bitmine, cited by Bitwise).

The real-world read

Read the source, not just the sentiment. Bitwise is an asset manager that sells crypto ETFs and staking products, so a report emphasizing "strong fundamentals" while prices fall is a house with an interested view — worth weighing accordingly. Its own most useful admission cuts against the yield pitch: when 90%+ of rewards are freshly minted tokens, the advertised 2.84%/6.25% is largely a wealth transfer from non-stakers, not income the network earned. The revenue drop is real regardless of whether you call it "protocol design" or "weak demand"; the report leans on the former. The Bitmine figure comes from Bitmine itself. And this is Bitwise's data reported through one outlet — no independent onchain numbers here to check it against.

This is news, not financial advice.

Sources

• The Block (Tier 2, secondary) — reported Benbrik's podcast remarks and summarized Bitwise's Q2 staking report; the underlying data and framing are Bitwise's. The Block discloses that Foresight Ventures is its majority investor.
• Bitwise Q2 staking report (primary data, interested party) — source of all yield, issuance and staked-supply figures; Bitwise sells staking and ETF products.