The Rise of Ethereum Beacon Chain and Its Implications

03/29/2023 03:24 • Blockchain Briefs • 111 views

According to reports, according to data from Dune Analytics, the total pledge amount of the Ethereum beacon chain reached 17982953 ETHs, and the pledged ETH accounted for 14.93% of the total supply of ETH. Among them, the pledge share of the liquidity pledge agreement Lido reached 31.35%. In addition, the total number of deposit addresses has reached 100968.

The total pledge amount of Ethereum Beacon Chain is close to 18 million ETHs

Ethereum, one of the major cryptocurrencies, has been making significant strides in recent times. According to recent reports, data from Dune Analytics revealed that the total pledge amount of the Ethereum beacon chain has reached an impressive 17982953 ETHs, which accounts for 14.93% of the total supply of ETH. Additionally, the deposit addresses on this blockchain have reached 100968. This article seeks to explore the Ethereum beacon chain and its implications for the cryptocurrency market.

What is Ethereum Beacon Chain?

The Ethereum beacon chain is the newest upgrade of the Ethereum blockchain, which has been designed to enhance its performance and sustainability. It is an entirely new blockchain that is built using a proof-of-stake (POS) consensus algorithm, which has replaced the old proof-of-work (POW) protocol that was previously used. The POS protocol allows validators to pledge their Ethereum holdings as collateral to participate in the validation process and earn rewards, making it more decentralized than POW.

Proof-of-Stake vs. Proof-of-Work

The shift from the old POW protocol to the new POS protocol is a significant milestone in the evolution of the Ethereum blockchain. While both protocols are used to validate transactions, POW uses a mining process that requires validators to solve complex mathematical problems to validate a block of transactions. This process can be time-consuming and costly, requiring expensive hardware and electricity. In contrast, POS validators do not need any mining equipment but must pledge their cryptocurrency holdings to secure the network.

The Implications of Ethereum Beacon Chain on the Cryptocurrency Market

The Ethereum beacon chain upgrade has brought several benefits for the cryptocurrency market. The shift to POS has led to a significant reduction in energy consumption, making the Ethereum network more environmentally friendly. Also, the increased decentralization of the network has enhanced its security, making it more resistant to attacks.
Furthermore, the significant amount of pledge on the Ethereum beacon chain, especially from the liquidity pledge agreement Lido, indicates growing trust and interest from investors. With the increase in deposit addresses, it is evident that more users are beginning to realize the potential of the Ethereum network and are willing to invest their funds. This situation has a positive impact on the Ethereum price, which may continue to rise as more investors pledge their holdings.

Conclusion

The Ethereum beacon chain is a significant upgrade to the Ethereum blockchain that has a positive effect on its performance, sustainability, and decentralization. With the rising pledge amounts and deposit addresses, it is evident that the Ethereum network is growing and has gained the trust of investors. The upgrade to POS protocol and the increase in deposit addresses have generated interest in this cryptocurrency, and it is likely to experience continued growth.

FAQs

Q1. Can I use my old Ethereum holdings on the new Ethereum beacon chain?
A1. Yes, you can use your old Ethereum holdings on the new Ethereum beacon chain. However, you will need to pledge your Ethereum as collateral to participate in the validation process.
Q2. What is the significance of the shift to POS protocol?
A2. The shift to POS protocol reduces energy consumption and makes the Ethereum network more environmentally friendly. Additionally, it increases decentralization, making the network more secure.
Q3. What is Lido, and why are they responsible for a significant amount of pledge on the Ethereum beacon chain?
A3. Lido is a liquidity pledge agreement that allows Ethereum holders to stake their holdings and earn rewards without any technical knowledge. Their ease of use and significant rewards have made them popular, leading to a significant amount of pledge on the Ethereum beacon chain.

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