Bitcoin News and Finance
Defi Educator Says $22 Billion in ETH 2.0 Funds Won’t Be Liquid Immediately After PoS Transition Skip to main content

Defi Educator Says $22 Billion in ETH 2.0 Funds Won’t Be Liquid Immediately After PoS Transition

As Ethereum’s transition to proof-of-stake (PoS) gets closer and the network’s hashrate taps another all-time high, the Ethereum 2.0 contract is close to nearing 13 million ether worth $22.6 billion using today’s ether exchange rates. Moreover, according to a decentralized finance (defi) educator, the $22.6 billion worth of ethereum that continues to grow won’t be unlocked until another upgrade is enforced following The Merge.

Ethereum 2.0 Contract Nears 13 Million Ether Locked — Defi Educator Says The Merge Won’t Be a Negative Price Catalyst

On June 4, 2022, etherscan.io’s webpage that hosts the Ethereum 2.0 contract, indicates that there’s 12,785,941 ether locked into the contract. The Ethereum 2.0 contract holds the funds for a great number of ETH validators as it takes 32 ETH to become a validator. Every single day, a decent quantity of validators lock funds in the contract and the current value locked in the contract is worth $22.6 billion using today’s ether exchange rates. During the last 24 hours, well over two dozen deposits of 32 ether ($56,684) have been added to the contract.

The $22.6 billion in ETH is locked and not liquid and may not be for quite some time. This means once the 32 ETH is deposited, the funds will remain locked up until plans are coordinated after the PoS transition. Just recently, the decentralized finance (defi) educator Korpi published a thread about the assumption that the 12.7 million ether will immediately be unlocked and dumped after The Merge.

“I’ve noticed some people consider The Merge as a negative price catalyst due to a supposed huge [ethereum] unlock — This is wrong,” Korpi explained on Twitter. “Staked [ethereum] won’t be unlocked at The Merge. The Merge won’t enable withdrawals. This is planned for another Ethereum upgrade which may take place 6-12 months after The Merge. In other words, both staked [ethereum] and staking rewards will not enter the circulation for a long time,” Korpi added. The defi educator continued:

Unlocked [ethereum] will be released slowly. Even when withdrawals are enabled, all staked [ethereum] won’t be immediately available. There will be an exit queue which may take more than a year in the worst-case scenario or several months in a more realistic one. [The] release will be slow.

Korpi Opines That ‘Ethereum Maxis’ Staking Coins Won’t Sell So Easily

Just recently, on June 4, at block height 14,902,285, Ethereum’s hashrate tapped an all-time high at 132 petahash per second (PH/s). At the end of May, ETH transaction fees hit a 10-month low as transaction costs dropped below $3. At the recent Permissionless conference, Ethereum software developer Preston Van Loon said The Merge could happen in August. Ethereum co-founder Vitalik Buterin confirmed that The Merge may be implemented by August, however, he also eluded to delays.

Amid the recent network records, Ethereum’s Beacon chain experienced a seven-block reorganization, and these types of issues may invoke a PoS transition delay. Ethereum’s Beacon chain is the chain that runs parallel alongside the proof-of-work (PoW) Ethereum network. Ethereum developer Tim Beiko recently detailed that The Merge will likely go live by the third quarter of 2022. Beiko further stressed that he “strongly suggests” ethereum (ETH) miners do not invest in more mining rigs going forward.

The defi educator Korpi continued his Twitter thread by explaining that the Ethereum 2.0 withdrawal process will be slow. “To withdraw [ethereum], a validator must exit the active validator set but there is a limit to how many validators can exit per epoch. There are currently 395k validators (active + pending). If no new ones are set up (highly unlikely), it will take 424 days for all of them to exit. Staked [ethereum] is often a never-sell stack.” Korpi added:

Who would voluntarily lock [ethereum] for many months, not knowing when withdrawals will be even possible? [Ethereum] maxis, no doubt. Most [ethereum] stakers are long-term investors. They are not interested in selling, especially not at current prices.

What do you think about the Ethereum 2.0 contract closing in on 13 million ether? What do you think about Korpi’s statements and the slow unwinding process he explained? Let us know what you think about this subject in the comments section below.

Labels:

Comments

Post a Comment

Popular posts from this blog

Custodial Lightning Network Service Attack Discovered by LN ‘Newbie’ — Hacker Strikes 6 LN Custodians

On September 18, a Redditor posted to the r/bitcoin forum and explained how he discovered a way to “attack [the] lightning Network’s custodial services.” The Reddit account dubbed “Reckless Satoshi” wanted to figure out if a “discrepancy between real routing fees and service’s transaction fee can be exploited for a profit.” The researcher disclosed that he wanted to see how large the damage could be and said “it is bad.” 6 Lightning Network Custodial Services Attacked, Researcher Discloses Findings to Offenders Prior to Public Disclosure A Redditor called Reckless Satoshi published a disclosure post on r/bitcoin this past Saturday and disclosed how he had found a vulnerability with routing fees and some of the Lightning Network’s custodial services. The research attack was done in good faith and after it was complete he disclosed the bugs to the offending services before publishing his findings. Reckless Satoshi used the Lightning Network (LN) attack on six different services incl
Post a Comment
Read more

Axie Infinity Down 40% Since Last Week’s Price High, Protocol Revenue Outshines Competitors

Last week, the game token leveraged within the Axie Infinity gaming universe skyrocketed to all-time highs, while other crypto markets remained extremely lackluster. During the last seven days, Axie Infinity’s platform token has dropped significantly in value shedding more than 12%. Meanwhile, the game platform’s smooth love potion token has slid over 8% over the last 24 hours. Axie Infinity Down More Than 40% Since All-Time High Not too long ago, the axie infinity (AXS) token was a topical conversation because it reached an all-time high on July 15. At the time, AXS managed to capture $28.93 per unit and since then it has shed 12.8% during the last seven days. The axie infinity (AXS) token is used within the blockchain-based game that involves battles between token-based creatures called “Axies.” AXS is used for the game’s governance system as well as other actions within the game. At the time of writing axie infinity (AXS) is exchanging hands for $16.70 per coin. AXS/USD on Ju
Post a Comment
Read more

Play-to-Earn Game From Polker (PKR) Exchange Listing – Endorsed by Akon

The Play-to-Earn NFT based Polker.Game ‘s native token $PKR has been officially listed on the popular centralized exchange BitMart. Polker.game has been in the spotlight recently as Akon, the American R&B superstar and record producer gave his official endorsement of polker stating that the “game is revolutionary” and that Polker is “hands down.. the best play to earn, NFT game in the space.”. With the BitMart listing and celebrity endorsement from Akon, Polker is perfectly positioned to become a major player in the Play-to-Earn league. Watch Akon’s Video Here What is Play-to-Earn? Although not a new concept, play-to-earn has become a trending term due to the popularity of the NFT game AXIE infinity. In the past, previous play-to-earn games have also achieved success – however, thanks to the huge amount of development in the blockchain space in recent years the gaming experience is now massively improved. Play-to-Earn games are essentially free to play and open to anyone and
Post a Comment
Read more

China to Crack Down on Copyright Infringement Through NFTs

Authorities in China are going after creators of digital collectibles based on other people’s works of art, the use of which was not authorized. The government offensive is part of a campaign to combat online copyright infringement and piracy with the participation of several departments. Regulators in China Move to Strengthen Copyright Supervision of Online Platforms The National Copyright Administration of China (NCAC) has recently launched a campaign against copyright infringement and piracy on the internet, together with the Ministry of Industry and Information Technology, the Ministry of Public Security, and the State Internet Information Office of the People’s Republic. A major objective of the initiative is to improve copyright supervision of online businesses by investigating cases involving the sale and distribution of infringing products on short video, live broadcast and e-commerce platforms, and promptly dealing with infringing content, the agency announced in a press r
Post a Comment
Read more
Blogarama - Blog Directory