Ethereum has a large contract on its Beacon Chain worth a whopping $32 billion in ETH that cannot be transacted with right now. Beacon Chain started back in early 2021 and started the Proof of Stake (PoS) mining system on the Ethereum network. Now, after months have passed, the two chains, Beacon and the legacy mainnet are awaiting a merger and this transaction will remain locked in place till that occurs, thus putting further pressure on the upgrade.
Ethereum’s developers have long decided on a slow-and-steady shift to a Proof of Stake (PoS) mining concept. This involved developing and deploying a parallel chain to the mainnet called Beacon Chain and the theory was that the PoS system and other necessary upgrades will be implemented on the Beacon Chain and eventually both the two systems will be merged, creating a single progressive Ethereum chain that will have all the necessary updates.
One contract on the Beacon Chain is however, making the news now for being the single largest contract in place with over 8,641,954 ETH in it. This means that all of this ETH (currently worth $32 billion) is locked in place. However, this ETH is basically locked in place till the mainnet and the Beacon Chain are merged into one another. Essentially, this big amount of crypto has been out of circulation for a long time and will likely continue to do so as we are nowhere near a complete merger at the moment. That requires a major hard fork as well.
According to one Twitter analyst:
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
What is even crazier is that the size of the contract is growing over time. This means that despite the chance that the contract will remain in place for a long time and it will be therefore difficult to retrieve the tokens, Ethereum users keep sending more and more ETH to it. Perhaps they are looking for a way to burn their ETH tokens and or keep them out of circulation for a while, thus appreciating the rest of their stash.
Overall, Ether has had a very strong last calendar year or so, rising considerably and is now inching towards a $5k valuation. However, the current dip in prices has made it depreciate back below $3.8k at the moment with many ETH traders looking towards the first quarter of the 2022 as the next phase of the bull run.
Image Source: pixabay.com
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