The total value of Swell, a liquid staking protocol, was fixed at double this month to 108,000 ether, worth about $245 million.
Since the beginning of December, Swell has recorded approximately $125 million in ETH deposits, making it the fourth largest liquid staking protocol. According to Dune data compiled by Dragonfly analyst Hildobby, the protocol currently lags behind major protocols such as Lido with 9 million ETH, Rocket Pool with 846,000 ETH, and Frax with 236,000 ETH.
The surge in Swell inflows coincides with the team issuing swETH, a liquid staking token, and announcing “Pearl” rewards in the form of points for users who “re-stake” on the EigenLayer platform.
Since the rewards program launched in mid-December, there has been notable activity, with users minting more than 53,000 swETH, worth more than $120 million. Most of these were later stored in EigenLayer.
EigenLayer allows users to deposit and re-stake Ethereum in a variety of liquid staking tokens to secure third-party networks. We have expanded our supported assets to include six additional liquid staking tokens, including swETH from Swell, sETH from Stakewise, xETH from Stader, oETH from Origin, ankrETH from Ankr, and Wrapped Beacon Ether (wBETH). Among these new additions, Swell has emerged as one of the biggest beneficiaries in terms of asset inflows.
Swell’s total value is locked | Source: Swell (via Dune)
centralization problem
Despite ongoing concerns about centralization, Swell’s surge in TVL shows that liquid staking continues to be a growing niche within the Ethereum ecosystem. The reason for its popularity is that it simplifies the complexities associated with staking, especially in terms of running validator nodes and allowing users to maintain control over their capital.
Swell users who stake ETH receive high-yielding liquid staking tokens in return. Not only do tokens hold value, they also offer flexibility as they can be held or leveraged within the wider DeFi ecosystem to generate additional revenue.
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