Inactive Ethereum Whale Suddenly Found Staking Nearly 49,000 ETH: Here’s What Happened
So far, ETH’s lack of flexibility in withdrawals has been a setback for the investors, who give more importance to liquidity than gradual yield.
An Ethereum whale, which remained inactive for a long period of time, has now started to suddenly stake a total of 48,992 ETH.
The whale had reportedly participated in the Ethereum Initial Coin Offering (ICO) in October last year, which resulted in putting an end to six years of long dormancy.
According to the on-chain analytics-focused Twitter account @lookonchain, the whale was found involved in a transfer of about 32,015 ETH tokens to a completely new address.
Currently, the tokens have a $53 million valuation. For those unaware, the term “whale” is used to refer to crypto wallets with massive stocks of cryptocurrencies.
The official Twitter handle of Lookonchain said, “We noticed that an ETH ICO participant who has been dormant for six years started to stake 48,992 ETH ($80 million) in October this year.”
According to Cryptonews, the Ethereum ICO had 120,000 ETH tokens in 2015 in three different wallets. And the whale could have a stake of about 67.5 percent of the 120,000 tokens they accessed from the Ethereum ICO.
However, this is only possible if they stake 32,015 tokens.
The current possibility of whale-staking ETH holdings hints at changing market conditions for ETH, as the first stakings occurred in the beacon chain in late 2020.
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However, several Ethereum owners have chosen to not stake their tokens. This continues despite the profitable yields of about 7–8 percent in the case of node operators, including 4-5 percent yields for staking pool participants.
This situation could be caused by the inability to withdraw ETH tokens at the moment. No flexibility in staked ETH withdrawals was aimed at protecting the network’s integrity while it was shifting from proof-of-work to proof-of-stake.
The transition was successfully completed in September last year.
At present, developers are trying to introduce the next big upgrade to the blockchain system called “Shanghai.” It is expected to happen by March this year.
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The new upgrade will ensure the withdrawal of staked ETH for the first time. More ETH holders are expected to be drawn to the token because of its greater withdrawal flexibility.
Following its merger in September 2022, the number of ETH staked increased by approximately 2.7 million ETH to 16.2 million.This means that 13.5 percent of the ETH supply is currently locked in staking.
Higher staking of Ethereum can also result in its price rise. So far, ETH’s lack of flexibility in withdrawals has been a setback for the investors, who give more importance to liquidity than the gradual yield.
According to several analysts, the shift in increased staking participation will result in a long-term price increase for Ethereum.
Other factors that could lead to a price rise are Ethereum developers’ attempts to introduce big upgrades on the blockchain.
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