The Ethereum merge is almost five weeks away and with the countdown to the main event getting shorter, the phrase, “buy rumours, sell news” is expected to run.
This means that we should expect an increase in demand for ETH in the next four weeks. A look at ETH’s on-chain metrics shows that this is already happening.
Whales Are Raising ETH
Whales holding large amounts of ETH have seen a significant increase in their balances, especially in the last four weeks. This is evidenced by an increase in addresses with balances exceeding 1000 ETH.
There has also been a significant increase in new deposits for ETH since the beginning of August. However, deposits declined significantly between August 9 and 10. This is because investors were waiting for the inflation data.
While the majority of acquired ETH goes to exchanges and private addresses, a huge amount has been put at stake.
There has been a steady increase in the share of ETH in Ethereum 2.0 over the past four weeks. Roughly 13.24 million ETH is currently locked in ETH 2.0 staking.
The total value locked in DeFi has also registered an overall increase over the last 30 days.
However, this too rose from $91.17 billion on August 9 to $88.27 billion on August 10.
The above data means that around 10.8% of ETH is currently held, while about 27% of ETH is locked in the DeFi protocol.
It is clear that ETH is currently experiencing healthy demand. This is also evidenced in its price action which has been bullish since mid-July.
ETH briefly climbed above $1,900 a few hours before press time. This, before a slight pullback, but its recent price action confirms that ETH is rapidly closing in on the $2000 price range.
Is Proof of Stake the Right Way to Go on Ethereum?
This is a question that ETH holders and users of the network should consider. Ethereum 2.0 comes with some sacrifice to the core principles that have governed decentralized systems so far.
In fact, there was a proposal to fork the network so that the Ethereum Proof of Work network would exist. Highlighting some of the issues a manifesto was published on official twitter account.