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In response to growing staking demand, Ethereum (ETH) has achieved a notable milestone, hitting a yearly high above $2,800. The Beacon Chain now boasts a total staked Ether amounting to 30,206,801 ETH, equivalent to over $85 billion, effectively locking up nearly 25% of the overall circulating supply. The current active validator count on the Beacon Chain stands at 943,974.

 

 

 

 

February has proven to be a bullish month for the Ethereum network. In the first half of the month, investors deposited an additional 600,000 ETH into Ethereum 2.0 staking contracts, coinciding with ETH’s surge to new yearly highs, currently trading at $2,774. The fact that a quarter of the circulating supply is locked in proof-of-stake (PoS) contracts signals optimism for the Ethereum network, enhancing security and efficiency. This increased staking reduces the ETH supply available for trading on exchanges, contributing to a diminished supply amid rising demand.

 

 

 

 

 

The Beacon Chain introduced PoS to the Ethereum ecosystem, merging with the original Ethereum proof-of-work (PoW) chain in September 2022, allowing validators to stake ETH. Presently, ETH stakers enjoy an annualized rewards rate of 4%. The Ethereum PoS network, operated by validators who staked 32 ETH into the smart contract, started with 21,063 validators and has now surpassed 900,000. Following the Shanghai upgrade in April 2023, validators were able to withdraw their staked ETH. Contrary to skeptics’ expectations, the number of staked ETH exceeded withdrawals within a week of the upgrade, indicating validators’ preference for restaking and passive income. As ETH continues its significant gains, approaching the $3,000 mark, attention turns to the approval of spot ETH ETFs by the Securities and Exchange Commission (SEC). With the recent approval of a spot Bitcoin ETF, the potential approval of spot ETH ETFs could become a crucial catalyst for Ethereum. This approval may lead to increased institutional demand, further reducing market supply due to continued staking activities.

 

 

 

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