- The market rally in June led to significant gains for Ethereum, along with the confidence financial institutions have in digital assets.
- According to on-chain analytics company Glassnode, transaction fees remained relatively low and have only increased by 28.5% since the ETF announcement.
- With the uncertainties surrounding withdrawals resolved after Shapella, people have regained more confidence in staking their ETH.
Ethereum has achieved significant gains following BlackRock’s spot Bitcoin ETF application, but investors continue to show interest in ETH staking.
Ethereum Achieves Significant Gains
The market rally in June led to significant gains for Ethereum, along with the confidence financial institutions have in digital assets. ETH has risen by 11% since the public announcement of Blackrock’s spot Bitcoin ETF application, compensating for the losses due to regulatory attacks.
However, the increase in value did not translate into a significant increase in network activity for the proof-of-stake (PoS) blockchain. According to on-chain analytics company Glassnode, transaction fees remained relatively low and have only increased by 28.5% since the ETF announcement.
Transaction fee refers to the amount charged to complete a transaction on the Ethereum network or execute a contract. This fee is determined based on the supply, demand, and network capacity at the time of the transaction, and lower fees indicate weak network demand.
The number of transactions that occurred as of June 5th was 740,048, which is more than 25% lower since the BTC ETF announcement.
Staking Becomes More Attractive
In contrast, there has been a larger increase in demand following the launch of the long-awaited Shapella update. As mentioned above, transaction fees have increased by almost 75% after Shapella, accompanied by a similar price increase.
This occurred because most Ethereum holders preferred to enjoy staking rewards rather than converting their assets into cash in the market, due to the uncertainties surrounding withdrawals being resolved after Shapella. People have regained more confidence in staking their ETH.
In the graph below, staking deposits to Ethereum’s Beacon contract have increased since the introduction of Shapella in April. On the other hand, the total number of transfers to centralized exchanges has remained at the same level.
