Most Of ETH 2.0 Stakers Remain Underwater As Bear Market Continues
Most of ETH 2.0 stakers remain underwater as the bear market continued and the price of ETH dropped more than 78% of its November ATH so let’s have a closer look at today’s latest Ethereum news.
Only 17% of Ethereum 2.0 stakers are now in profit most of the ETH 2.0 stakers are underwater, feeling the full weight of the ongoing bear market according to the reports from Glassnode. With the second biggest crypto hitting a new ATH of $4891, the total dollar value of the staked Ethereum reached $39.7 billion but the crypto rout brought ETH to the current levels of $1,100 and the value of the ETH 2.0 smart contract dropped to $25.65 billion which puts it 65.2% lower than nine months ago.
This is despite the inflow of 5 million ETH since the November peak as was pointed out by the analysts:
“With ETH prices collapsing over 78%, and coins unable to be withdrawn, only 17% of staked ETH is now in profit.”
This means that Ethereum 2.0 stakers on average are holding a loss of 55% and the reports show:
“if we compare this to the Realized Price for the entire ETH supply, 2.0 stakers are currently shouldering 36.5% larger losses compared to the general Ethereum market.”
According to Glassnode, 62% of the staked ETH were deposited before the November ATH so among the other improvements, the much anticipated ETH transition to the Proof of stake consensus mechanism with the Merge upgrade, will also bring a change to the way transactions on the network are validated. Right now, ETH relies on energy-intensive operations similar to the ones used by BTC miners but with the transition, transactions will be added to blocks by stakers who pledged a minimum of 32 ETH to a smart contract.
Ethereum already had a PoS-based chain dubbed Beacon Chain which was launched in December and it is running alongside the network’s current mainnet. Since then, the investors were depositing their coins to operate as validators with the staked ETH reaching 12.98 million coins or 11% of the circulating supply:
“Throughout 2020 and 2021, it was common to see between 500 to 1,000 new deposits of 32 ETH per day. Currently, the weekly average number of deposits has dropped to just 122 per day, which is the lowest it has been to date.”
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