Staked ETH surpasses exchange balances with 19% of supply locked Staked ETH surpasses exchange balances with 19% of supply locked
Since the Shanghai upgrade — which enabled withdrawal of staked ETH in April — centralized exchanges' ETH balances have been on the decline.
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Updated: Jun. 27, 2023 at 1:16 pm UTC
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Ethereum (ETH) staked by investors has outstripped the ETH balance on centralized exchanges, including Binance and Coinbase, Nansen data indicates.
As of June 26, 2023, 23.36 million ETH worth nearly $44 billion, which represents 19.4% of the current supply, was staked, according to Nansen data. Comparatively, Ethereum held by centralized exchanges fell short at 23.35 million ETH yesterday, per Nansen.
However, it is worth noting that Beacon Chain data suggests there are only 20.3 million ETH staked currently, raising questions about the discrepancy between Nansen and Beacon Chain data.
Centralized exchanges’ holdings of the second-largest cryptocurrency have been on the decline over the past few months. The crypto crackdown started by the U.S. Securities and Exchange Commission (SEC) has only accelerated the outflow.
Nansen data shows that the ETH holdings of centralized exchanges have been slashed by 5 million ETH since the Shapella upgrade in mid-April, which enabled the withdrawal of staked ETH.
Coinbase’s ETH balance declined by around 1 million ETH, or nearly $1.8 billion, to $7.2 billion during the period, as per Glassnode data. Ethereum on Binance, on the other hand, fell from 4.7 million ETH to 4.1 million ETH after the upgrade.
During the same period, staked ETH increased by 4 million ETH, Nansen data suggests. The data further indicates that ETH staking deposits have outpaced withdrawals over the past week, reversing the trend of rapid withdrawals after the SEC announced its lawsuits against Binance and Coinbase. On the back of this boost in staking deposits, popular liquid staking platform Lido announced that its total value locked (TVL) jumped by 12.72% last week.
Nansen analyst Martin Lee told DLNews that some of the Ether that appeared to have left the centralized exchanges has actually been staked by them. Many centralized exchanges offer options for users to stake Ethereum, but regulatory concerns have always been present.
Martin Lee, an analyst at Nansen, told DLNews that some of the Ethereum previously held by centralized exchanges has been reallocated to staking mechanisms operated by these same platforms. Despite the fact that many centralized exchanges provide staking options for Ethereum, the potential for regulatory scrutiny remains a constant consideration.
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Monika Ghosh
In 2020, Monika immersed herself in crypto, maintaining skepticism yet firmly believing blockchain could address key issues like financial disparity and transparency. A book-lover, she's also a passionate food enthusiast.
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Jacob Oliver
Jacob Oliver is a recovering academic and English teacher turned crypto journalist and web3 writer. He holds a Ph.D. from the University of Washington.
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