The number of active validators for Ethereum 2.0 (or Serenity) has been increasing rapidly since the beginning of the year. This suggests more Ether (ETH) being staked on the deposit contract.
Eth2 Staking and Validators
According to the data from Beaconcha.in, 3,616,331 ETH have been staked on the Ethereum 2.0 deposit contract, which represents about 3.136 percent of the total ETH in circulation. The coins staked are worth over $7 billion, following the price of ETH at US$1,958 at the time of writing. Additionally, there are currently 113,012 active validators on the network.
The increasing number of coins staked on the Ethereum 2.0 deposit contract indicates the community’s growing level of confidence for the Proof-of-Stake (PoS) era. The full deployment of Ethereum 2.0 would transition the mainnet from a Proof-of-Work (PoW) model to PoS, where new blocks are added to the blockchain through validators instead of miners.
To become a validator, users are expected to stake at least 32 ETH (US$62,656). Meanwhile, the annual percentage return (APR) for staking on the deposit contract is 8.1 percent, according to Eth2 LaunchPad.
Eth2 to Address Network Congestion Issue With Current Mainnet
Scalability is a serious issue affecting the current Ethereum network. There is a massive number of users and projects on the blockchain, hence, resulting in the congestion of the network. Consequently, this usually causes a spike in the network fee, thereby making Ethereum more expensive for smaller users. As seen in recent months, many projects had to migrate to other blockchains, often towards Binance Smart Chain (BSC), for reasons that include high transaction fees.
Eth developers are planning to fix these issues through Ethereum 2.0, which is a better and more scalable version of the current network. However, Eth2 won’t be launched until the next two years, at least.
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