On-chain data recently showed that Ethereum Staking has seen significant growth over the past month. This undoubtedly presents a bullish outlook for the Ethereum ecosystemwhich is already brimming with plenty of bullish sentiment heading into July.
Nearly 60,000 unique depositors join the Ethereum network
Data from on-chain analytics platform CryptoQuant shows that 59,894 new depositors have joined the ETH staking network since May 20. Interestingly, this significant increase began around the time Bloomberg analysts James Seyffart and Eric Balchunas increased their chances of approval for the Spot ETF Ethereum at 75%.
This once again highlights the Spot Ethereum ETFs positive impact on ETH, even though they have not yet started trading. Thanks to these funds, the network achieved a 4% increase in staking participation in just over a month. Increased participation in staking is bullish for ETH, making the network more decentralized.
Additionally, the increase in new depositors will also reduce the already dwindling circulating supply of ETH, since these depositors must lock up a significant amount of ETH to become validators on the network. Data from Dune Analytics shows that more than 33 million ETH are blockedrepresenting nearly 28% of Ethereum’s total supply.
ETH supply paints a bullish picture
A reduction of Ethereum Circulating Supply is a bullish fundamental as it helps reduce the impact of any potential selling pressure on the crypto token. The positive impact of these locked tokens also becomes more evident as demand for Ethereum increases, as the price of ETH will bow to supply and demand dynamics.
The distribution of ETH also paints an optimistic picture for the crypto token. Data of IntoTheBlock Market Intelligence Platform shows that approximately 78% of the supply of , including staked ETH, is held by long-term holders, those who have held the crypto token for more than a year.
This shows that Ethereum’s supply is concentrated in the hands of individuals who are unlikely to part with their holdings anytime soon. This is significant, given that institutional investors are poised to increase demand for ETH once the Ethereum ETFs under the microscope begin trading. These funds are expected to begin trading this month.
Balchunas recently suggested that these Spot Ethereum ETFs could begin trading shortly after July 8. Balchunas and Seyffart previously predicted that these funds could begin trading by July 2. However, Balchunas noted that the Securities and Exchange Commission (SEC) It took longer to get back to the issuers of the Spot Ethereum ETF, so they had to change their timeline regarding the launch of these funds.
Matt Hougan, Bitwise’s Chief Investment Officer recently predicted that these Spot Ethereum ETFs could attract $15 billion in their first 18 months of trading.
At the time of writing, ETH is trading at around $3,470, up more than 2% in the past 24 hours, according to data from CoinMarketCap.
Featured image created with Dall.E, chart from Tradingview.com
