Here’s Why $33 Billion Worth of ETH in this ETH 2.0 Contract is Awaiting a Hardfork

An Ethereum Beacon chain staking contract currently comprising of 8,641,954 ETH worth over $33 billion has caught the crypto community’s attention. The staking contract in question can neither spend nor transfer the mammoth ETH holdings to any address without a hard fork. What makes the situation even more interesting is the fact that traders staking their ETH in the mentioned contract were well aware of the fact that there is no set time frame for them to retrieve it and yet they decided to deposit it.

A Twitter user who goes by the name of Tomer Strolight took to Twitter to raise speculations around the ETH 2.0 staking contract. While he did mention that people have willingly sent ETH to the address, he didn’t clear the air around why so.

BREAKING: 8,641,954 ETH ($32 billion) trapped in single largest Ethereum contract and unable to be sent or spent. Will require hard fork that hasn’t been written or specified yet. Timing and terms of hard fork still unknown.https://t.co/xcXPwbS93v

— Tomer Strolight | Not interested in your trades. (@TomerStrolight) December 14, 2021

The Beacon chain staking contracts are the first major upgrade for Ethereum’s Proof-of-Stake move and it also brought validator staking for ETH 2.0. So all the ETH currently staked in the said contract have been sent by traders looking to become validators on ETH 2.0 whenever it is launched. A minimum of 32 ETH is required to become a staker and a large amount of staked ETH indicates the growing demand for the PoS network.

The Beacon chain was launched in December 2020 and is expected to merge with the Ethereum mainnet by the first or second quarter of 2022. Until then all the staked ETH in the smart contract would remain non-functional. The heavy staking in the ETH 2.0 contracts has been one of the key reasons behind the drastic decline in ETH supply on centralized exchanges.

Ethereum Price Eyes Recovery

Ether’s price is currently trading above $3,800 after falling to a daily low of $3,714. The second-largest cryptocurrency by market cap is nearing its major PoS merger and crypto pundits expect the price to move in anticipation.

Ethereum developers have said the move to ETH 2.0 would not just make the Ethereum network 99% more energy efficient from its current Proof-of-Work mining consensus, but would also enhance scalability.