Ethereum Staking Exceeds $121 Billion: What This Means for the Crypto Market

• Nansen highlights a potential supply crunch in Ethereum, which could influence its market price amid high staking levels.
• If an Ethereum ETF is approved and attracts demand, Ethereum’s price could rise, recently surpassing $3,700.

The total value of staked Ethereum has now exceeded $121 billion, representing about 27% of its total supply, as reported by Nansen, a company specializing in on-chain data analysis. This staking represents a significant portion of Ethereum’s market, suggesting potential implications for its supply levels.

Nansen’s data shows that 32.5 million ETH are currently staked, and this amount, valued at around $121 billion, compares notably to Solana’s Fully Diluted Valuation (FDV) of $103 billion. This substantial staking activity in Ethereum has sparked discussions regarding the possibility of a supply crunch, which could influence its market price.

According to Nansen, the outcome for Ethereum’s market price largely depends on the demand for the cryptocurrency, especially in light of potential Ethereum ETF approvals. They pointed out that if an Ethereum ETF is approved and it attracts sufficient market demand, Ethereum’s price is likely to rise. 

“If an ETH ETF gets approved and there is demand, either in anticipation or after approval then this would be positive,” Nansen stated.

This was observed recently when the price of Ethereum surged past $3,700 amid speculative anticipation of such approvals. Conversely, Nansen highlighted that without significant demand, the large volume of staked Ethereum may not dramatically affect the market price.

Regarding Ethereum’s market, the cryptocurrency has shown some fluctuations. Although it recently gained value, Ethereum struggled to consistently maintain a price above $3,700. As of May 22, the price of Ethereum fell by 2.19%, reaching $3,705.54.

Despite this decline, Ethereum’s market capitalization remains strong at $446.16 billion, although its 24-hour trade volume decreased by 42.02% to $27.51 billion.

Market analysts and industry experts maintain a positive outlook on Ethereum’s price trajectory. Geoff Kendrick from Standard Chartered has reiterated a bullish target of $8,000 for Ethereum by year-end.

This optimism is supported by ongoing developments around Ethereum ETFs , which are expected to be approved soon, enhancing Ethereum’s profile and investment appeal.

Additionally, the U.S. Securities and Exchange Commission (SEC) has actively engaged with ETF applicants , encouraging them to update their filings. This move by the SEC indicates a strategic approach to incorporate Ethereum more seamlessly into the financial system, signifying its potential for further growth and establishment in the financial sector.

Ethereum (ETH) is currently at $3745.3 USD, down 1.20% recently. In the last week, its value increased by 29.99% and it has risen by 81.66% in the last six months. Its market capitalization is $450.05 billion USD and its all-time high was $4868.8 USD.