Ethereum: Never before have there been so many ETH in smart contracts

More than 35 percent of all Ethereum is now in smart contracts. What this means and the implications of this development.

Ethereum (ETH) reached a new record: 35.3 percent of all ether in circulation is now integrated into smart contracts. This record figure is a clear sign of the continued confidence and growing use of the Ethereum ecosystem.

The fact that so much of the ETH supply is locked up in smart contracts speaks volumes about current market dynamics. Instead of circulating on trading platforms where ETH could easily be sold, it is being used in the world of staking, restaking in DeFi protocols, DAOs and in the development of other innovative projects.

An increasing amount of this ETH is not just temporarily locked up, but invested in the ecosystem for the long term. This phenomenon highlights the strong commitment of the Ethereum community and the deep confidence in the future viability and added value of the platform.

This development has far-reaching implications. First, it demonstrates that demand for ETH is strong, as investors are willing to hold and use their ETH for the long-term benefit of the network. Second, it proves Ethereum's practicality. Unlike many other cryptocurrencies that are traded primarily as speculative assets, Ethereum serves as the basis for a variety of applications that provide tangible benefits, at least to its loyal user base.

Capturing such a large portion of the ETH supply indicates that the Ethereum network is steadily growing, not only as a technological platform, but also as a financial ecosystem. With such a large amount of ETH locked up in the ecosystem, Ethereum is becoming increasingly scarce on the open market.

In an environment where demand for ETH remains constant or even increases and it seems likely that this year we will see the approval of the first ETH ETF will see, this scarcity can lead to an upward trend in price.