Staked Ethereum Hits New All-Time Highs Ahead Of The Merge

Ethereum was formerly developed as a PoW blockchain. However, it’s been planning to transition to PoS through an upgrade tagged the merge. The process, which has different phases, is almost getting to completion as the date for the merge draws closer. The target is September 15 and would finally merge the Ethereum mainnet and the Beacon Chain.

Staking is a process that allows crypto token holders to lock their holdings for a given period. It has become one of the desirable processes within the crypto space as users get rewards from it. Besides earning rewards, staking provides a reliable means for validating transactions on the blockchain.

The Proof-of-Stake (PoS) consensus mechanism is more accepted in the crypto industry than the Proof-of-Work (PoW). This is because the latter, which operates with mining, consumes more energy.

In most cases, the energy sources are fossil fuels which result in carbon emissions. Hence, it’s a threat to the environment and has received increased concern within and outside the industry.

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Ethereum was formerly developed as a PoW blockchain. However, it’s been planning to transition to PoS through an upgrade tagged the merge. The process, which has different phases, is almost getting to completion as the date for the merge draws closer. The target is September 15 and would finally merge the Ethereum mainnet and the Beacon Chain.

Before the completion of the transition, the Ethereum team developed the Beacon Chain, which runs with a PoS consensus mechanism. The chain allows users to stake ETH seamlessly for the validation of transactions.

With the date for the upcoming merge getting closer, there is an increasing number of staked ETH tokens on the ETH 2.0 staking contract. Though Ether has been experiencing a slight drop in value, the staked amount of tokens kept rising.

According to the data from Dune Analysis, the staking contract has received over 13.2 million staked ETH. However, the unique addresses of the depositors are below 80,000. Therefore, the data shows that staked ETH has hit a new all-time high regarding the number of Ethers.

Also, the estimated dollar value has surged to almost $24 billion. This exceeds the last year’s peak value for staked ETH though the token price was $5,000 during the period.

Success Is Connected To Upcoming Ethereum Merge

The excellent stance for Ethereum staked token has received support from the Ethereum team. Developers have continually released updates regarding the progress on the networks, especially its transitions from PoW to PoS.

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As the Merge approaches, several participants in the crypto industry are dishing out their views. However, there are still popular opinions that the transition would spike the price of Ether. On his part, Arthur Hayes, the CEO of BitMEX, expects a boost in the price of Ether if the Merge succeeds.

Ethereum tanks by 8% on the chart l Source: ETHUSDT on TradingView.com

Mark Cuban thinks the transition could initially intend to sell the news. However, he still sees the Merge as an excellent move for the Ethereum blockchain.

Featured image from The Pixabay, Chart from TradingView.com