Ether Surges above $2,800; Staking and Whale Accumulations Fuel Optimism
Summary:
Ether (ETH) experienced a 3% surge over the last 24 hours, trading over $2,800. Its performance mirrored Bitcoin's trend, which had a 16.3% increase in the past week. The ETH hike is largely due to a decrease in exchange supply due to staking, accumulation by large ETH holders, and positive outlook among investors. Notably, 25.56% of all circulating ETH is staked on the Beacon Chain. Additionally, the Ethereum staking protocol, EigenLayer, saw a 33% rise in locked value, surpassing other leading crypto lending protocols. As Bitcoin crossed the $50,000 threshold, traders speculate that ETH may break $3,000 soon. The possible approval of an Ethereum exchange-traded fund (ETF) by mid-2024 further fuels this optimism.
Ether (ETH), the world's second biggest cryptocurrency, surged more than 3% in the previous 24 hours — trading over $2,800. Consistent with Bitcoin's (BTC) 16.3% increase over the past week, ETH also noted a 16% surge in that time frame. This spike in ETH's value can be tied to several factors, including a decrease in its availability in exchanges due to staking practices, ETH whale accumulations, and a bullish sentiment among both retail and institutional investors.
Recent data from Dune points that roughly 30,708,316 ETH or 25.56% of its total circulating supply, is currently staked on the Beacon Chain. This amassed staking pool measures over $86.68 billion, with Lido handling 31.65% of it. Within the first half of February, investors staked an additional 600,000 ETH in the Ethereum 2.0 staking contract. With more tokens locked in layer-2 blockchains, the value locked (TVL) on Ethereum restaking protocol, EigenLayer, surged 33% in the last week, reaching $7.09 billion on Feb. 15. Such accumulation surpasses crypto lending protocols JustLend and Aave, earning the third spot.
Restaking lets holders reuse staked or confined Ether to amplify its staking returns while earning a share of protocol yield and potentially, airdrops. An increase in Ether staking ensures network efficiency and security, and it also decreases the amount of tokens available to be traded in the exchanges. This diminishes supply while increasing demand, which could be a positive signal for Ether's value.
ETH's price movements have historically mirrored Bitcoin's trend, implying that with BTC breaking past the $50,000 mark on Feb. 12, ETH could cross the $3,000 threshold soon. There's also an apparent rise in derivatives metrics, showing how traders are increasing their bullish long bets. CryptoQuant data revealed that ETH's funding rate leaped to 0.4% on Feb. 13, marking its highest since Jan. 8, suggesting more leveraged bets on ETH's potential price hike. An uptick in positive funding rates indicates that long-position holders are prepared to pay higher fees to short traders, predicting a price increase.
Further boosting Ether's rally is the optimism surrounding the likely approval of a spot Ethereum exchange-traded fund (ETF) by the first half of 2024. In preparation, institutional investors reportedly accumulated more ETH. Data from blockchain analysis platform Lookonchain reveals that ETH's 24% price heightening since February's start could be linked to an anonymous whale who acquired approximately 69,500 ETH or around $179 million, from leading exchanges such as Binance, Bybit, Bitfinex, and OKX in the same period.
It's essential to note that this information does not serve as investment advice or recommendations. Each investment or trading action has its inherent risks, and individuals are encouraged to do their research before making any decisions.
Published At
2/16/2024 1:20:55 AM
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