Ethereum Staking Tops 35 Million ETH as Investors Double Down in June

Ethereum staking contracts now hold more than 35 million ETH (nearly 29% of the total supply!) after users added over 500,000 ETH during the first half of June. At the same time, wallets that have never sold ETH reached a new record of 22.8 million ETH.

The staking activity happened on Ethereum's Beacon Chain, which runs the network's Proof-of-Stake system. Validators and long-term holders drove both the staking increases and the growth in accumulation addresses.

Economic Impact: Supply Squeeze and Enhanced Security

Nearly 29 percent of all ETH is now locked in staking contracts, removing it from active trading. This reduces the amount of ETH available for sale while strengthening network security through validators.

The June staking surge continues a trend that started when Ethereum switched to Proof-of-Stake in September 2022. The transition, known as The Merge, cut the network's energy consumption by over 99 percent and introduced staking rewards for validators.

Staking requires users to lock up at least 32 ETH to become validators, though smaller amounts can be staked through pooling services. Validators earn rewards for processing transactions and securing the network.

Impact of staking on Ethereum 

Looking ahead, Ethereum’s growing staking system could help speed up the growth of decentralized finance (DeFi) and Web3 apps. A robust, energy-efficient, and decentralized validator network serves as the foundation for more reliable and scalable DeFi and Web3 applications.

Staking is also changing how people interact with Ethereum. Since users lock up their ETH for longer periods, they tend to focus more on the long-term success of the network. This dynamic encourages long-term alignment with the network's success over short-term speculation, fostering a more stable crypto-economy.

Also read: When Was Ethereum Created and How It Transformed Blockchain?

As staking becomes more popular, it could also affect how Ethereum is managed and updated. With more ETH locked in staking for the long term, validators might gain more influence, which could change how decisions about the network are made in the future.