The growth rate of the Ethereum network’s fundamentals has been impressive lately. The rising number of validators on the chain in the last 30 days demonstrates this growth.
700% Increase In The Number Of Ethereum Validators In 2 Years
Multiple blockchain data shows that Ethereum’s technical performance has been quite impressive. There are nearly 355K validators on the Ethereum network, with about 55K added over the past 30 days.
Ethereum validators chart. Source: beaconcha.in
After the excitement of the Ethereum beacon chain launch two years ago, the second-largest digital asset entered a new growth phase and has kept growing since then. As of January 2021, Ethereum validators were just shy of 50,000. Hence, their 700% increase is proof of investors’ confidence in the blockchain.
Greater Investor Confidence
Also, there has been a gradual decline in the amount of Ethereum in custodial crypto wallets since July 2020. Such an increase in private crypto wallets and a decrease in custodial crypto wallets are signs of bullishness for the digital asset involved (in this case, Ethereum).
If investors lack confidence in Ethereum, they will leave most of their holdings with crypto exchanges where they can be used for trading. Hence, transferring such holdings to non-custodial wallets is a big show of confidence. However, it may also mean that these holders want to invest some of their holdings in DeFi projects. A recent CryptoQuant data revealed that the amount of ETH in custodial wallets is less than 24M which is 10M short of the amount in these wallets as of July 2020.
Amount of ETH in custodial wallets. Source: CryptoQuant.
As the amount of eth in non-custodial wallets continues to rise, there has also been a steady rise in the combined value of staked eth, which is nearly 11m as of this writing. The network’s performance has been impressive despite fluctuations in eth price.
A Brighter Future For Ethereum
The impressive technical performances of Ethereum and its governance token (the ETH) are proof of the market’s confidence in the network. Aside from these technical aspects, the network has also made remarkable progress in other areas. One such progress is the integration of the Kiln testnet into the eth2.0 mainnet. However, the team has disclosed that the complete switch to Eth2.0 won’t exceed this year.
The network is also making progress with its accessory supports. For instance, the overall evaluation of optimism (a layer-2 network) hit a new peak of $527M earlier this week. This network has also been performing impressively in the last couple of weeks. These developments and milestone achievements give investors the confidence to be bullish about the blockchain’s future.
Despite the competition from other networks like Solana, Ethereum continues to be the preferred network for DeFi and NFTs. These are crypto sectors with massive potential in the future. The main factor that might make investors lose confidence in Ethereum is if it fails to complete its switch to a PoS blockchain.