Ethereum (ETH) has seen a surge in price throughout April, and this increase has corresponded with a significant milestone for Ethereum’s Layer 2 networks: the total value locked (TVL) has surpassed $10 billion as of April 14, according to L2Beat, an analytics and research website about Ethereum layer 2 scaling.
This marks a new record high for the amount of ETH locked on the Ethereum network since the Shapella upgrade. With the TVL of Ethereum’s Layer 2 networks hitting an all-time high, many are speculating about the potential for further growth and adoption of these companion networks.
After the Shapella Upgrade was put in place, the price of Ethereum [ETH] became more volatile. Still, the Ethereum network has gotten a lot of attention, as shown by the fact that most deposits have been made on its beacon chain. There have been more deposits compared to withdrawals on the networrk.
As more and more users turn to Layer 2 solutions to address the high fees and congestion on the main Ethereum network, it remains to be seen how this trend will continue to evolve in the coming months.
Nansen’s records show that since the Shapella upgrade, the amount of ETH locked on the Ethereum network has reached a new all-time high. As of April 24, the total amount of ETH locked was 18,879,775 ETH.
Ethereum Layer 2 Networks See Record TVL
TVL is a metric used in the cryptocurrency world to measure the amount of digital assets locked in various protocols or applications. It is often used as an indicator of the level of activity and demand within a specific DeFi (decentralized finance) ecosystem.
The TVL of Ethereum’s Layer 2 networks, which are complementary networks to Ethereum, also increased along with the rising value of ETH in April, peaking at a record high of $10 billion on mid-April.
Despite a decline in crypto prices, the TVL has since remained at around $9.22 billion, more than double its value at the start of the year, according to L2Beat, a layer 2 analytics site.
However, it is worth noting that there is currently approximately 4.7% of the total ETH on the Beacon chain waiting for full exit, which includes rewards amounting to 894,671 ETH. Furthermore, 27,809 validators are currently waiting for a full exit.
Whale Interest In ETH Down As Short-Term Holders Exit Positions
Meanwhile, Glassnode’s recent data has revealed a decrease in whale interest in ETH, with the total number of addresses holding more than 10 ETH reaching a four-month low of 349,078.
This can be attributed to the increasing long/short difference, which suggests that many short-term holders have sold their holdings and exited their positions.
#Ethereum $ETH Number of Addresses Holding 10+ Coins just reached a 4-month low of 349,078
Previous 4-month low of 349,082 was observed on 23 April 2023
View metric:https://t.co/6ggy1nLbSD pic.twitter.com/BsKhJDysPR
— glassnode alerts (@glassnodealerts) April 24, 2023
As a result, the future of ETH’s prices will depend heavily on the behavior of long-term holders.
Despite this decline, the current Ethereum price on CoinMarketCap is $1,829.37, showing a 1.48% decrease in the past 24 hours.
Only time will tell if long-term holders will continue to support ETH or if the decline in whale interest will have a lasting impact on its value.
-Featured image from CoinChapter