The world’s second-largest cryptocurrency by market capitalization Ethereum (ETH) has seen the amount of ETH staked within Ethereum 2.0 surge to a new all-time high of 47.38 million ETH, equivalent to 33.9% of the cryptocurrency’s supply.

According to data from on-chain analytics firm Santiment, the figure has more than tripled from around 10.9% of the cryptocurrency’s supply held in the ETH2 Beacon Deposit Contract two years ago, and now stands at over $140 billion.

Staking in Ethereum 2.0 surged as more users allocated their funds to become validators, who lock up their ETH to help secure the network in its new Proof-of-Stake consensus algorithm. In return, they earn staking rewards, but ETH remains a deflationary cryptocurrency as an earlier upgrade meant transaction fees are burned.

Santiment’s data also highlights a shift in how Ethereum is held. Wallets containing over 10 million ETH or more – meaning the Beacon Deposit Contract – have seen their share of the total supply increase by 23% in the past two years. Conversely, holdings in smaller and mid-tier wallets (excluding the Beacon Deposit Contract) have declined, suggesting a movement towards staking.

As reported, long-term ETH investors are now holding around 78% of the cryptocurrency’s circulating supply, which means that buyers who have been holding onto their funds for more than a year now control the majority of circulating ETH.

These long-term investors are less likely to sell their coins compared to those who have held them for a shorter period. The trend of LTH dominance is seen as a bullish sign for Ethereum, suggesting growing confidence among investors, with the significant concentration they now have effectively taking a significant amount of the cryptocurrency out of circulation, limiting potential downward pressure on the price.

Featured image via Pixabay.