Ethereum Price Heads to $3k as Staking Deposits Hit $85 Billion

ETH Price Insights: 

• Ethereum (ETH) price soared to a new 2024 peak at $2,827 on Thursday Feb 15, sparking optimism that the $3,000 target is within reach. 
• 25% of Ethereum circulating supply is now locked up in the ETH 2,0 beacon chain smart contracts. 
• If the bulls can scale the initial resistance level at $2,850, the bulls can set their sights on the $3,000 target.

Ethereum price crossed the $2,800 milestone on Feb. 15, but rising volume of staking deposits on the ETH.20  beacon chain smart contracts could propel it even further. 

Rising staking deposits and positive market sentiment surrounding the potential ETH ETF approval have emerged as dominant bullish catalysts for ETH price. 

Can the bulls build on this momentum to reclaim the $3,000 for the first time 3 years?

Ethereum Price Staking Deposits Crosses 25% Milestone

Ethereum price made another giant stride on Feb. 15 as it crossed the elusive $2,820 territory to bring its weekly gains to 13%. 

Ethereum developers launched the Dencun upgrade on the Sepolia testnet at the end of January 2024, to positive reaction from ETH stakeholders market participants. 

With a promise of improving network throughput and reducing transaction costs, Dencun upgrade may attract more developers and users to the Ethereum DeFi ecosystem. This increased utility and adoption could drive demand for ETH, ultimately driving up its price.

Notably, Ethereum has witnessed a significant increase in the staking depostins, as investors look  to front-run the expected gains from the recent network improvement and potential Ethereum ETF approval. 

Between Feb 1 and Feb 15, Investors have deposited another 600,000 ETH into Ethereum 2.0 staking contracts. 

As per official data from the Beacon chain, 30.2 million ETH are now locked up in Ethereum beacon chain staking contracts. Notably, this works out to 25% of total Ethereum circulating supply.

In simple terms, a quarter of the total ETH coins in circulation are now deposited in ETH2.0 staking contracts on the beacon chain by 943,756 network validators. This milestone is bullish for a number of reasons. 

Firstly, increased staking is crucial for any PoS blockchain as it improves the network’s security and efficiency. More importantly, it temporarily reduces coins readily available to be traded on exchange spot markets. 

Currently, ETH stakers get an annualized rewards rate of 4%. This passive income structure and positive market sentiment could further incentivise more staking deposits in the coming days. 

Given the prevailing bullish sentiment surrounding the crypto markets, these crucial factors could combine to accelerate the ETH price rally toward the $3,000 mark in the coming weeks. 

Ethereum price forecast: Can the Bulls Clear the $2,850 Roadblock ? 

In summary, the induced market scarcity from the rising staking deposits puts Ethereum price in prime position for another leg-up toward $3,000. However, in the short-term, the bullish traders face a major roadblock at the $2,850 area.

IntoTheBlock’ global in/out of the money (GIOM) data groups all existing ETH holders according to their historical buy-in prices. Currently, it depicts 1.23 million addresses that acquired 578,014 ETH at the minimum price of $2,860.

This cluster of holders could mount a roadblock if they opt to book some profits as Etherum prices approaches their break-even point.

However, if the bulls can stage a decisive breakout above the $2,850, a $3,000 retest could be on the cards as predicted.

On the downside the bears could negate this optimistic prediction if Ethereum price dips below $2,500. However, as seen above, the 1.51 million addresses that acquired 4.92 million ETH at a minimum price of $2,360

To avoid slipping into loss positions, those investors could make frantic last-minute purchases to cover their positions, which could inadvertently trigger a rebound. 

Quote source: FX Empire