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The carbon footprint of the Ethereum blockchain is expected to decrease by 99% after last week’s Merge event. By positioning staking as a service for retail and institutional investors, the upgrade could also have a significant impact on the crypto-economy, according to a report from Bitwise on Tuesday.

The company said it expects potential gains of 4% to 8% for long-term investors via Ether (ETH) staking, while JP Morgan analysts expect staking to pay off on PoS blockchains could double to $40 billion by 2025.

Users who stake crypto assets earn rewards – called returns – from transaction fees paid by other network users. Considered by some to be a form of passive income generation, staking requires users to lock their assets into a smart contract, during which coins cannot be spent or traded on the market. This can be one of the main challenges to the adoption of PoS blockchains, especially by institutional investors.

During a second quarter earnings call, Coinbase CEO Alesia Haas noted that institutional staking of crypto assets could be a “phenomenon” in the future as soon as the market overcomes its liquidity lock-in.

Industry players have come up with a number of solutions in an attempt to address this lack of liquidity surrounding staked coins. On Sunday, Alluvions announcement a liquid collective enterprise and multi-chain protocol with Coinbase and Kraken as integrators and Staked, Coinbase Cloud and Figment as validators. The solution aims to provide institutional holders with a viable liquid staking solution.

“Proof of Stake blockchains account for more than half of the total crypto market cap, but there hasn’t been a viable option for institutional token holders to participate in liquid staking,” said Matt Leisinger, CEO of Alluvial, in a press release.

Before the merger, the Swiss digital asset banking platform SEBA Bank launched an Ethereum staking service for institutions eager to earn returns through staking on the Ethereum network. According to the company, this decision was a response to the growing institutional demand for decentralized finance (DeFi) services.

“Not only are investors diving headfirst into staking, they are leveraging DeFi’s liquid staking services and composability to amplify the APY and utility of the assets they are already staking,” declared the authors of a Bitwise report.

The opportunity to stake could also lead to other centralization issues for the community. A few hours after completing the upgrade, Santiment’s analysis indicated that 46.15% of Ethereum’s PoS nodes are controlled by only two addresses owned by Lido and Coinbase, holding 30.8% and 14.7% market share of the $13.2 billion ETH staked as of August 31, respectively.

As more staking providers enter the market, not only will institutional holders benefit, but risks can also be diversified and network resilience can improve, according to Bitwise analysis.