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Ethereum Reaches New Milestone Ahead of "Merge": Details

Mon, 08/22/2022 - 10:01
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Tomiwabold Olajide
About 36,000 ETH have been added every week, and 153,000 new ETH have been staked since August
Ethereum Reaches New Milestone Ahead of "Merge": Details
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Ethereum keeps achieving new milestones before the widely anticipated "Merge" release. There are now 13,343,768 addresses for ETH 2.0 deposit contracts, to be exact. The deposit contract on the Beacon Chain allows ETH holders to lock their assets ahead of the transition.

As reported by Colin Wu, "According to OKLink, the number of ETH 2.0 deposit contract addresses has reached 13,343,768, and the stake rate has exceeded 11.17%. About 36,000 ETHs have been added every week, and 153,000 new ETHs have been staked since August."

The hypothesis that the staking APR might rise after the Merge may be to blame for the increase in the stake rate.

Ethereum Devs Confirm Previously Announced Merge Date

The Goerli testnet merge was completed on Aug. 10, the last test before switching from proof of work (PoW) to proof of stake (PoS) on the mainnet (also known as the Merge). It is now projected that Ethereum will complete the Merge on or about Sept. 15 (TTD 58750000000000000000000). With this achievement, the energy use of the Ethereum network will reportedly be reduced by 99.95% when compared to PoW.

Ethereum debunks misconceptions ahead of the "Merge"

In the face of great expectations regarding the Merge, Ethereum is out to dispel some myths. No doubt, the APR for stakers is expected to increase post-Merge, but it is still not yet clear by how much.

It states that the rise in APR does not come from an increase in protocol ETH issuance but results from a reallocation of transaction fees, which will now go to validators rather than miners.

It debunks the speculation that the staking APR is expected to triple after the Merge, stating that more recent estimates place the post-Merge APR increase closer to 50% rather than 200%.

Ethereum Denies Claims That Merge Will Lead to Lower Gas Prices: Report

Additionally, it disproves the notion that staked ETH might be withdrawn following the Merge by stating that staked ETH, staking rewards received thus far and newly issued ETH immediately following the Merge will all remain locked on the Beacon Chain without the option to withdraw.

Instead, withdrawals are scheduled for the Shanghai update, which will come after The Merge as the next significant upgrade. This indicates that newly issued ETH will be locked and illiquid for at least 6 to 12 months after the Merge, albeit while accumulating on the Beacon Chain.

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About the author

Tomiwabold is a cryptocurrency analyst and an experienced technical analyst. He pays close attention to cryptocurrency research, conducting comprehensive price analysis and exchanging predictions of estimated market trends. Tomiwabold earned his degree at the University of Lagos.