Ethereum News Today: SharpLink Stakes Big on Linea to Fuel Ethereum’s Future

SharpLink Gaming Inc. (SBET) disclosed that it intends to stake an unspecified portion of its $3.6 billion Ethereum (ETH) holdings on the Ethereum layer-2 network Linea following its mainnet launch on September 10. Joseph Chalom, co-CEO of SharpLink, stated in an interview with Decrypt that the company is currently staking most of its holdings through custodians like Anchorage and Coinbase. However, as part of its strategy to enhance returns and diversify staking methods, SharpLink is exploring staking opportunities on Linea, which could offer better yield, particularly with regard to risk-adjusted returns [1].

Chalom emphasized the significance of supporting Ethereum and its aligned layer-2 (L2) projects, particularly Linea, which is being developed by Consensys. He noted that increased high-quality activity on such platforms should, in turn, benefit Ethereum’s price, which is in the interest of SharpLink as one of the largest ETH holders. “When I say we're here to support Ethereum, we're here to support Ethereum and the L2s that derive from it,” Chalom said, highlighting the company's commitment to Ethereum-aligned initiatives [1].

The decision aligns with SharpLink’s recent move to join the Linea Consortium, a group of companies tasked with stewarding 75% of the LINEA token distribution. Chalom described the consortium as mission-aligned to make Linea a highly successful L2 network, noting that more than 80% of the token supply would be allocated to support on-chain projects [1].

Linea, co-created by Joe Lubin, co-founder of Ethereum and chairman of SharpLink’s board of directors, is designed to support the Ethereum base layer through mechanisms such as native yield on bridged ETH and ETH burns. This approach addresses concerns that L2 networks might detract from Ethereum’s mainnet value [1].

The company’s decision to stake on Linea has not come without market volatility. On the same week the news was reported, the price of Ethereum dropped by approximately 3.27%, and SBET shares fell 8.26% as investors reacted to the declining cryptocurrency prices. Additionally, the market seemed to factor in the recent restricted stock unit (RSU) awards granted to co-CEO Chalom, which may have influenced investor sentiment [2]. The awards included time-based and performance-based RSUs, with vesting over a three-year period starting from Chalom’s employment commencement on July 25 [2].

Despite the recent downturn, SharpLink remains positioned at the intersection of traditional and digital finance. Chalom’s prior work at BlackRock, including the launch of the iShares Ethereum Trust (ETHA), underscores the company’s long-term strategic interest in the Ethereum ecosystem [2].

Source:

[1] SharpLink Will Explore Staking Portion of $3.6 Billion (https://finance.yahoo.com/news/sharplink-explore-staking-portion-3-162046340.html)

[2] SharpLink (SBET) Falls 8% on Ethereum Decline (https://finance.yahoo.com/news/sharplink-sbet-falls-8-ethereum-185423398.html)