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On-chain Analysis: Does Beacon Chain Show the Potential of Ethereum 2.0?

The Ethereum 2.0 mainnet called Beacon Chain has been kicking off since December 2020. Most recently, Ethereum 2.0’s first major upgrade, Altair, was a huge success (and on schedule). After the Altair upgrade, Ethereum (ETH) established a new ATH.

There are many signs that both on-chain and off-chain show the growth potential of ETH in the near future.  


Total Deposit

Total deposits into the Beacon chain have now totaled up to 8.2 million ETH.

Looking back on history, the amount deposited into the contract also represents the increasing confidence of investors in Ethereum 2.0.

– Since the announcement of the deposit contract address in November 2020, the amount of ETH deposited has gradually increased to reach 2 million ETH by the end of the year. That is in just 2 months.

– From 2 million to 4 million ETH took 4 months.

– In May 2021, along with the time when the ETH price pumped strongly and then dropped rapidly, investors also deposited more ETH into the contract. From 4 million to 6 million ETH in just 2 months.

– From there, the amount of ETH deposited gradually slowed down. It took 4 months after that, i.e.November 2021, the Ethereum 2.0 deposit contract reached 8 million ETH.

In USD terms, the amount of ETH locked in the contract totals $16.8 billion.

Notably, in May of this year, when the ETH price peaked and then dumped heavily, the amount of money deposited also had a sudden surge. Although the ETH price dropped 50% of its value and then started to rise again, the amount deposited into the contract did not decrease. These signals reinforce the perception that investors are confident in the future of ETH and Ethereum 2.0.

While $16.8 billion sounds high, in reality, 8.2 million ETH is only equivalent to nearly 7% ofthetotal Ethereum supply.


Validator Distribution

One of the main differences when Ethereum moves from PoW to PoS is the change in who will “dominate” the Ethereum network.

Unlike Ethereum 1.0 where miners have the biggest say, with Ethereum 2.0, who stakes ETH the most, also known as thevalidator, will hold the right to decide.

Therefore, one of the top factors is to consider who is staking ETH the most? Which validator is ruling the network? Or rather, is Ethereum decentralized?

Analyzing wallet addresses that deposit ETH into deposit contracts, it can be seen that validators are divided into 4 main groups including:

  • Exchange: 27.9%
  • Whale: 8.76%
  • Staking pool: 25.4%
  • And others: 38%

Zooming into the entities involved, we see that Lido leads the way with 17%, followed by Kraken (11%) and Binance (9%). A collection of 39 whales make up another 9% and Coinbase rounds off the top 5 with 6%.

More specifically, it can be seen that Lido (Lido Finance – the leading staking solution on Ethereum, Terra,and Solana) is leading with 17%. Followed by two exchanges Kraken (11%) and Binance (9%).

Compared to the miner distribution chart, the current validator distribution is better, but has not yet reached the “decentralized” level as the community has always expected.


Node Distribution

In addition, another important indicator in Beacon Chain analysis is the nodedistribution. According to data from Chain Safe, there are currently 4,564 Beacon nodes distributed geographically across 66 countries.

Out of these 66 countries, North America and Europe dominate with 81% of the nodes.

It is noteworthy that the allocation of these Beacon Chain nodes is also quite similar to that of Ethereum’s PoW nodes.



The above figures show that the community and investors feel very confident in the future of Ethereum. All hope that the transition to PoS will help open a new history for this coin.

Besides, the distribution of validators and nodes has improved a lot over PoW. We can expect Ethereum to become more and more “decentralized”.



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