- The amount of staked ETH has increased significantly over the past few weeks.
- ETH’s price continued to move sideways.
Ethereum [ETH] has remained stagnant around the $3600 level for quite some time. But despite the sideways movement, optimism around the cryptocurrency has remained high.
This was indicated by the rising interest in ETH staking over the last few weeks.
Ethereum staking on the rise
According to recent data, 32.5 million ETH had been staked on the network.
Source: X
Even though the number of stakers increased, which can typically drive up rewards, both the reward rate and inflation rate for staking ETH saw a decrease.
The reward rate refers to the annual percentage return a user gets for staking ETH. It’s essentially the interest a user earns to help secure the network.
The inflation rate, on the other hand, reflects how quickly the total supply of ETH increases. New ETH is created as staking rewards, and this contributes to inflation.
A declining reward rate means a user will earn a bit less new ETH per staked token in the short term. However, a declining inflation rate suggests the total supply of ETH is growing at a slower pace.
In the long run, this could actually be a positive sign for the value of ETH. If demand for ETH stays strong while the supply grows slower, it could push the price of ETH up.
Source: Staking Rewards
At press time, ETH was trading at $3,669.67. After surging past the $3,600 level after the ETF announcement, the price has moved between the $3,979 and $3,607 level.
This recent correction in ETH’s price could be attributed to profit-taking done by short term holders after the sudden uptick in price.
The RSI (Relative Strength Index) for ETH had declined significantly over the last few days, implying that the bullish momentum for ETH had slowed down.
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Additionally, the CMF (Chaikin Money Flow) for ETH had also diminished, implying that money flowing into ETH had declined. If bearish sentiment prevails, ETH may retest the $3,607 levels before moving upwards.
Source: Trading View
Ethereum’s Network Growth also declined materially over the last few days. This implied that new addresses showing interest in ETH had fallen, which may cause problems for the altcoin in the long run.
Source: Santiment