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A croissant has recently laid out an argument for Ethereum becoming a leading asset in the world. The Twitter handle which is known as @CroissantETH shared some interesting facts around the second-largest cryptocurrency in the space. These made for some sound arguments and have really shown why Ethereum has the potential to become of the world’s most productive assets in coming years.
Making The Argument For Ethereum
The Croissant Twitter account first laid out the groundwork for its argument using the start of the project. Ethereum which was created five years ago had initially offered 72 million ETH to more than 10,000 Bitcoin addresses for taking part in its ICO. Keep in mind that Bitcoin was still what could be considered at its infancy then and cryptocurrencies were still a novel idea.
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Fast-forward to five years later and most of these addresses no longer hold a significant portion of the coins that were offered during the ICO. In fact 81% of these over 10,000 Bitcoin wallets now only hold about 1% or less in their balances, with 9.5% remaining untouched, presumed to belong to users who no longer have access to their wallets. Only 64 users increased their holdings in the future.
Now there are 118 million ETH that has been rewarded for blocks mined. All of the ETH from these wallets have gone towards smart contracts on the Ethereum network. It estimates that 26.86% of ETH are held in these smart contracts. These ETH have gone to decentralized applications that help power the virtual economies on the network (eg DeFi) along with stable coins and other features that are now associated with the blockchain.
Of this 26.68% locked in smart contracts, 77% of the total value is locked in DeFi on the network.
These are decentralized applications that power virtual economies, stable coins, and many other things home to Ethereum.
Of that 26.86% in smart contracts, 77% is locked in DeFi.
That’s an astounding 24.5M ETH, representing 20.67% of the total supply. pic.twitter.com/8riWfaP3iu
— croissant (@CroissantEth) November 30, 2021
ETH trending above $4,600 | Source: ETHUSD on TradingView.com
Exchange Reserves Near Three-Year Lows
CroissantETH also pointed to plummeting Ethereum exchange reserves to make its case. Armed with data from Glassnode, it shows that exchange balances have declined to near three-year lows, despite the bullish nature of the market presently. Centralized exchanges only now hold 14,146,767 ETH on their balances, a mere 12% of the total circulating supply of the digital asset.
Staking on the network has grown in tandem with the declining exchange supply. The total amount of ETH staked on the network has now reached 7.08% of the total circulating supply. This coupled with declining exchange reserves proves that investors have no intention of selling their ETH. Rather they’re making their holdings work for them by moving the assets over to DeFi.
Related Reading | Ethereum Founder Puts Forward New Fix For High Gas Fees
Additionally, 50% of ETH’s supply has remained unmoved for more than a year. The longer the time frame, the lesser the amount of ETH that has moved. In short, Ethereum holders have no plans of selling.
When you also start to consider the fact that there are 13,636 dApps, and more than 300,000 ERC20’s deployed on the network, I think you’ll start to get what I mean by a “𝘱𝘳𝘰𝘥𝘶𝘤𝘵𝘪𝘷𝘦 𝘢𝘴𝘴𝘦𝘵”
Let’s recap… pic.twitter.com/rNJjZLVrTe
— croissant (@CroissantEth) November 30, 2021
The thread concluded with the Twitter account stating that the mindset around the digital asset is shifting rapidly. “We are very quickly moving from the mindset of ‘I buy ETH because it appreciates’ to the mindset of ‘I buy ETH to do things’,” it stated.
Featured image from The Legal Examiner, chart from TradingView.com
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