The Beacon Chain has witnessed a significant milestone as the total amount of staked Ether (ETH) has surpassed 30,206,801 ETH, equivalent to over $85 billion. This represents approximately 25% of the total circulating supply of ETH. Currently, there are 943,974 active validators operating on the Beacon Chain.
February has proved to be a bullish month for the Ethereum network. Within the first two weeks of the month, investors deposited 600,000 ETH into Ethereum 2.0 staking contracts. Additionally, the price of ETH surged to yearly highs, surpassing $2,800. As of now, ETH is trading at $2,774.
This substantial amount of ETH locked in proof-of-stake (PoS) contracts is seen as a positive indicator for the Ethereum network. The increase in staked ETH enhances the network’s security and efficiency, while simultaneously reducing the available ETH supply for trading on exchanges. This reduction in supply, coupled with the growing demand, contributes to a favorable market dynamic.
The Beacon Chain introduced PoS to the Ethereum ecosystem when it merged with the original Ethereum proof-of-work (PoW) chain in September 2022. This integration enabled validators to stake ETH. Currently, ETH stakers receive an annualized rewards rate of 4%.
The Ethereum PoS network is operated by a group of validators who are required to stake 32 ETH. Initially starting with 21,063 validators, the Beacon Chain now boasts an impressive count of over 900,000 validators.
Following the Shanghai upgrade scheduled for April 2023, validators will have the option to withdraw their staked ETH. Some critics had anticipated a surge in withdrawal demand from validators. However, within a week of the Shanghai upgrade, the amount of newly staked ETH exceeded the amount withdrawn, indicating that validators were reinvesting their ETH to earn passive income.
The price of ETH has experienced a rally in recent weeks, achieving double-digit gains and aiming to surpass the $3,000 mark. With the approval of spot Bitcoin exchange-traded funds (ETFs) in the United States, attention is now shifting towards spot Ether ETFs and the possibility of approval by the U.S. Securities and Exchange Commission. The introduction of spot Ether ETFs could have a significant impact on the second-largest cryptocurrency, as institutional demand for ETH would further decrease the available supply in the market.
In addition to these developments, the concept of “account abstraction” has revolutionized Ethereum wallets, providing users with a comprehensive guide to enhance their usage and understanding of the platform.