This contract now contains over 10 million coins and the price action might be tied to it
The Ethereum2 deposit address just exceeded 10 million ETH coins locked. The Ethereum deposit contract is used to lock a certain amount of Ethereum coins and receive constant staking rewards for validating on-chain transactions.
To become part of the validator community, a user would need 32 ETH, which is why almost every transaction on the Etherscan transaction page equals 32 ETH. The total value of funds locked in the contract now equals $26 billion, according to the actual ETH/USD rate.
The increase in the rate of investment in solutions such as Ethereum staking indicates that the majority of traders in the market prefer low-risk opportunities over regular trading or stablecoin staking.
Currently, the Ethereum staking solution allows for earning approximately 5% APY with a hike to approximately 12% later in the year, according to Coinbase. The increase is tied to the fact that the Ethereum network is going to switch off its Proof-of-Work consensus protocol and turn on pure Proof-of-Stake. The merger will lead to a massive decrease in energy consumption and the increased role of validators on the network.
Many on-chain experts have noted that Ethereum could face even larger inflows into the contract as the cryptocurrency market becomes more mature and risk-friendly. The average volatility of Bitcoin and other cryptocurrencies has already declined significantly from the same cycles in 2013-2017.
At press time, Ethereum is going through a tough short-term correction and losing around 6% of its previously gained value, along with the majority of cryptocurrency wallets. In the last three months, Ethereum has lost over 60% of its previously gained value.
