Seven weeks after the launch of Ethereum 2.0’s beacon chain and 2.25 million ETH has been deposited into the ETH2 contract address, signaling growing confidence in the long-awaited rollout of ETH2.
More than 66,360 beacon chain validators have been created as part of Ethereum’s transition from Proof of Work to Proof of Stake.
Data provided by smart contract experts at Dune Analytics suggests that more ETH is now being staked by individual contributors than single addresses with large balances, which had dominated flows to the Eth2 contract throughout December and the first half of January.
The dollar amount of ETH deposited into the Eth2 contract stands at approximately $3.75 billion, or 2.5% of Ethereum’s total market cap, with 4,864 unique depositor addresses contributing to the total amount of ETH staked on the new network.
The state of Eth2
In a post titled "The State of Eth 2," Ethereum Foundation researcher Danny Ryan recapped progress made in 2020 and painted a picture of things to come in 2021.
Ryan reports that testing is continuing on the newly-implemented beacon chain, which will serve as the bridge by which ETH1 will communicate with ETH2. He predicts that the first half of the year will be dedicated to research and development of user clients, as upgrade specifications are “vetted and refined.”
Next up is the implementation of shard chains, also known as phase 1 of the ETH2 rollout, which is expected to take place in the latter half of 2021. The sharding of Ethereum will allow the network’s load to be spread across 64 chains, increasing its transaction capacity exponentially and thus ability to scale.
While inspired by promising developments along the road to global adoption, Ryan predicts that even layer-two scaling won't enable the current iteration of Ethereum to fully cope with its growing popularity:
“It is abundantly clear that Ethereum L1 today will not, alone, provide the throughput needed to support the global demand for decentralized applications. Although Ethereum’s current L1 coupled with L2 scalability techniques will help massively in the next 12 months… Ethereum will continue to see demand outstrip supply as global adoption continues.”
Thus far, the Eth2 rollout has been more or less consistent with the roadmap introduced by Ethereum mastermind Vitalik Buterin in Dec. 2020.
Stakers who made the initial deposits are receiving interest up to 21.6% APR on their amount staked. As the interest rate per total amount staked is based on an inverse logarithmic graph, it decreases with the amount of ETH staked. Deposits received today will receive an APR of 9.4%.