Mark Weaden
According to data released by crypto analysts Crypto Quant, Ethereum (ETH) staking has passed another milestone as more than 10% of the total ETH supply is now locked within the contract.
The Ethereum network has seen a sharper uptrend in recent months, as a wave of ETH holders looks to earn. Vitalik Buterin will be pleased to see that the switch to a “Proof of Stake” protocol has been a successful move thus far.
What Fueled the Surge?
A recent surge in the number of people staking ETH has resulted in there being around 12 Million ETH now in the Ethereum 2.0 deposit contract. The staking system on the Ethereum network is now working on a (PoS) consensus, which came after the release of Ethereum 2.0.
The benefits of switching to a PoS framework are just beginning to show. The main drive for the change from a “Proof of Work” (PoW) network was to avoid the carbon footprint left as a result of the high energy costs to run and maintain a PoW network.
However, with PoS, network validators (known as the stakes) must lock in a minimum amount of the crypto into a contract—which is 32 ETH in this case—to participate in the consensus system. This is a lot of funds for the average person, but with Ethereum’s PoS system nodes can be divided to reduce the cost.
Proof Of Work Being Left Behind
With industry leaders Bitcoin still running a PoW network, the PoW framework isn’t going anywhere. However, for networks like Ethereum, that have a plethora of use cases and ambitions to scale, it’s imperative that Ethereum 2.0 is a success.
Proof of Work requires an excessive amount of computing power to run, as potential block creators compete with either to sign off on transactions. However, the necessity to operate with a high power requirement has meant that the industry has been in the media crosshair since the high energy usage of PoW networks was reported in early 2021.
The new environmentally friendly PoS network has been a great success. Though, there is still a long way to go to reach the standards expected by environmentally friendly industries.
The Price Of Ethereum
With cryptocurrency markets down, it’s no surprise to see the price of Ethereum at $2,815, at the time of writing. The price of ETH has been on a steady decline for the past week or so, with cryptocurrency losing 17% value in the last month.
