The Ethereum merger update was once the most anticipated news in the crypto space, but now it is in the past, the next anticipated update is the Shanghai network upgrade.
As the Shanghai network upgrade is scheduled, which is expected to be opened in March, approaching, the number of validators has been seen to increase. It has now surpassed the benchmark of 500,000 since joining, according to data from BeaconScan.
Total Ethereum Validators Exceeds 500,000
After exceeding the 400,000 benchmark in July last year, the number of validators in Ethereum it has now crossed 500,000 and is currently at 501,893.
For context, a blockchain validator or validator is one who verifies and validates transactions on the blockchain network to prevent double spending errors, among other blockchain activities.
Because of Ethereum blocking has recently moved from the Proof-of-work (PoW) mechanism to the Proof-of-stake (PoS) mechanism, validators on the ETH network must now issue a certain amount of 32 ETH, which is worth approximately $50,302 in current market value, to be qualified to validate the transaction.
Since the PoS mechanism newly introduced to the Ethereum network, features like withdrawal of funds are delayed. However, after the scheduled launch of the Shanghai upgrade, which will allow validators to withdraw their staked ETH and finally make a profit, there has been a huge increase in the number of validators.
To prevent a mass exodus of validators after the launch of the Shanghai upgrade, ETH developers have placed a withdrawal limit that is limited to 43,200 ETH per day from the total amount of ETH purchased.
The Reason Behind the Rise in Ethereum Validators
Although it may seem like the rise of Ethereum validators is due to the upcoming network Shanghai upgrade, it is more than easy accessibility to be a validator in the blockchain created by other platforms such as Lido and Rocket Pool.
These two platforms allow one to become a validator on the Ethereum network without having to stake a total of 32 ETH. Lido and Rocket Pool allow users with less than 32 ETH stake to participate as validators. In exchange for staked ETH, users receive liquid staking derivative tokens, also known as LSD, which can be used for additional returns in DeFi.
While the number of Ethereum validators continues to rise, the token itself has followed the bullish trend in the crypto market. In the past seven days, ETH has rallied 18.9% and is currently trading at a market price of $1,571 at the time of writing, with a 24-hour trading volume of $8.3 billion.
Featured images from Freepiks, charts from TradingView.com