Ethereum

Defi Educator: $22 Billion in Ethereum 2.0 Funds Will Not Be Liquid Right 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 that some people view The Merge [ethereum] as a negative price trigger — This is wrong,” Korpi explained via Twitter. “Staked[ethereum] will not be unlocked at The Merge. Withdrawals are not possible through The Merge. This is planned for another Ethereum upgrade which may take place 6-12 months after The Merge. Korpi explained that both the staked [ethereum], and staking rewards won’t enter circulation for a long period of time. Continued Korpi:

Unlocked [ethereum] will be released slowly. All staked [ethereum], even after withdrawals are enabled will not be available immediately. In the worst case scenario, it may take over a year to clear and in the best-case scenario, it could take several months. [The] will take a while to be released.

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. The Ethereum Beacon chain runs parallel to 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 continues his Twitter thread explaining that Ethereum 2.0 withdrawals will be slow. To withdraw [ethereum],, a validator must exit from the active validator list. However, there is a limit on how many validators can exit per EPOC. 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. “Stacked [ethereum] is often a stack that never sells.” Korpi added:

Who would voluntarily lock [ethereum] for many months, not knowing when withdrawals will be even possible? [Ethereum] maxis, no doubt. The majority of [ethereum] stakers invest long-term. They don’t want to sell, especially at current prices.

This story contains tags

32 ETH, contract, decentralized finance, defi educator, ETH 2.0, ETH Validators, ether, Ethereum, Ethereum 2.0, Ethereum’s Beacon chain, Fees, Hashrate, Korpi, network, PoS transition, Preston Van Loon, technology, The Merge, Tim Beiko, Validator, Validators, Vitalik Buterin

What do you think about the Ethereum 2.0 contract closing in on 13 million ether? What did you think of Korpi’s statements? Comment below to let us know your thoughts on this topic.

Jamie Redman

Jamie Redman, the News Lead at Bitcoin.com News, is a Florida-based financial journalist. Redman has been an active member of the cryptocurrency community since 2011. Redman is passionate about Bitcoin, open-source codes, and decentralized applications. Since September 2015, Redman has written more than 5,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

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Ethereum

Ethereum Traders Just Flipped Bullish, But History Says This Is a Major Red Flag

Ethereum’s bounce toward $3,500 triggered instant FOMO, but Santiment says extreme optimism usually means price is about to disappoint.

Ethereum traders have swung sharply from extreme bearishness to extreme bullishness within just a few days, based on social media sentiment.

But fresh data suggest that when ETH nearly rebounded to $3,500 on Thursday, the crowd interpreted the move as a confirmation that the asset was “back in business.”

ETH Trader FOMO

Santiment warned that this sudden pivot is similar to the same pattern seen earlier in the week, when retail panic selling actually contributed to the rebound. Now, the rapid return of FOMO could similarly stall further upside.

According to the analytics platform, prices have shown a tendency to move in the opposite direction of the crowd, and that more neutral sentiment phases have proven to be stronger buy signal environments than euphoric ones.

Crypto trader Ted Pillows also noted that even though the altcoin is showing some rebound after this week’s sharp decline, the recovery lacks conviction. According to Pillows, the current move higher, though modest, is being driven largely by short positions being closed rather than new spot buyers stepping in. He added that Ethereum needs to reclaim the $3,600-$3,700 price range with meaningful inflows to establish strength and dismiss the risk of further downside. Without that confirmation, Pillows believes the odds still favor lower prices from here.

Despite the near-term uncertainty, some traders say the bigger picture is still pointing toward a substantial upside scenario. For instance, crypto trader “Trader Tradigrade” said that ETH’s monthly chart is currently developing what he describes as a massive Inverse Head and Shoulders pattern, with a potential price target of $14,000 once confirmed.

“Wet Blanket” Phase

As the crypto market remains sluggish, Galaxy CEO Mike Novogratz believes that this could be due to long-term holders rebalancing their net worths and diversifying away from massive concentrated holdings after a very long bull market. Novogratz deems this to be a healthy sign in the medium and long term as these positions get distributed. In the short run, however, he said that “it’s a proverbial wet blanket” and has weighed on prices.

About the author

Chayanika has been working as a financial journalist for six years. A graduate in Political Science and Journalism, her interest lies in regulatory implications with a focus on technological evolution in the crypto realm.

Ethereum

Ethereum Price Analysis: Will $3K Hold as ETH’s Bearish Momentum Intensifies?

Ethereum has slipped below the $3,300 mark, indicating persistent selling pressure in this zone. While bears aren’t showing strong momentum just yet, the fact that the price declined following a major liquidation event, one that already cleared out many over-leveraged longs, raises the risk of further downside. This hints that spot sellers could now be in control, opening the door for a deeper short-term correction.

Technical Analysis

By Shayan

The Daily Chart

On the daily chart, ETH dropped below the channel and has fallen slightly beneath the 200-day moving average. It is currently breaking below the $3,300 demand zone too. This is a key level Ethereum is now losing, as the 200-day moving average is known as one of the most critical indicators for determining whether the overall market phase is bullish or bearish.

The RSI also remains weak at 32, showing the market is not bound for recovery yet. For buyers to regain control, ETH needs to break back above $3,500 and flip that region and the 200-day moving average into support. Until then, the price is sitting in a vulnerable zone, which could push the price lower toward the $3,000 support level in the coming days.

The 4-Hour Chart

The 4-hour chart shows a quick rejection from the lower boundary of the broken channel and the previous support zone, around $3,400. The price is currently hovering around the level and has yet to form a convincing rebound or create a higher low.

The RSI is also stabilizing below the 50% level, as the momentum is clearly bearish. With ETH breaking the $3,300 to the downside once more, the next sweep toward the $3,000 zone and lower could come fast.

Sentiment Analysis

Long Liquidations

Sentiment-wise, liquidations wiped out a large portion of late long entries, creating a cleaner slate for the price to stabilize. The chart shows a major liquidation spike right before the small bounce, confirming the shakeout.

With many positions flushed and the RSI nearing oversold regions across multiple timeframes, the market might soon be due for a reset. Yet, traders are likely to stay cautious, waiting for clearer strength and a break back above $3,500 before reloading on longs.

On the other hand, a drop toward the $3,000 level could ignite another liquidation cascade and lead to an even more significant liquidation event, which could result in another flash crash in the upcoming weeks.

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Ethereum

Argentine Exchange Ripio Launches Digital Peso as Part of Latam’s Stablecoin Rollout

Ripio stated that the Argentine peso stablecoin, wARS, would be available on Ethereum, World Chain, and Base, as a key element to expand the exchange’s infrastructure in Latam. It stated that additional local stablecoins would be launched to support several use cases using blockchain tech. Ripio Debuts Digital Peso in Argentina…
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