On November 24, the Ethereum 2.0 deposit contract finally reached the full number of ETH required to launch its genesis block. Only hours away from the final deadline, whales decided to deposit the remaining ETH. Receiving the funds incredibly slowly in the beginning, Ethereum 2.0 managed to raise the 50% remaining ETH needed in only the last two days.
Released in early November, the Ethereum 2.0 deposit contract required users to deposit a total of 540,000 ETH. Worth $325 million per current prices, the large number of tokens was needed to fulfill the original target required for launching the genesis block. Now, both the genesis block and the beacon chain are scheduled to launch on December 1.
The new network upgrade brings a major overhaul to the Ethereum ecosystem. ETH 2.0 brings a new Proof-of-Stake consensus mechanism which will completely change the protocol’s economic model. With a soft launch at the beginning of next month, developers will finally finish Phase 0 of Ethereum 2.0. While the full release remains unknown, experts suspect that ETH holders will have to wait for December next year.
More than 150K ETH deposited in 24 hours
As Defiye previously reported, developers launched the Ethereum 2.0 deposit contract on November 4 with the intention to collect 524,288 ETH. If reached, the smart contract would release the genesis block on December 1. However, users had a deadline for reaching the target seven days before the soft launch.
As we have seen, holders decided to deposit at the very last minute. More than 150,000 ETH were deposited in the last 24 hours. In fact, the remaining 25% of ETH were collected in only four hours. At 10:45 PM UTC on Monday, the deposit contract held only 385,440 ETH.
Within the duration of this event, Ether had its fun as well. The leading cryptocurrency exploded in recent weeks and finally reached $600. The price levels that we are now seeing were last observed in June 2018.
Ethereum 2.0 to reward stakers with 20% annual return
Contrary to popular belief, Ethereum 2.0 will not fully launch next month. In fact, developers intend to only launch the beacon chain, a ledger containing a list of validators. By doing so, the initial version of the network will track all validators, those who hold 32 Ether or more.
The beacon chain will run side-by-side with the original Ethereum network for the time being. Developers still have to finish three more stages, Phase 1, Phase 1.5, and Phase 2. At the end of this staging process, Ethereum 2.0 will entirely replace the old network. But by that moment, investors should expect no significant changes in the behavior of Ethereum. However, it may be an entirely different story for the project’s cryptocurrency.
With currently raised funds, Ethereum 2.0 rewards its validators with a return rate of 20% per year. As such, the increasing demand for ETH may lead to higher prices. In fact, many believe that today’s price is supported by the fact that developers launched the deposit contract. The price of ETH nearly doubled since its launch, growing from $380 to $620 in less than a month.
Furthermore, the bullish price action is also supported by the leading cryptocurrency. For the first time in years, Bitcoin has now reached $19,000.
At the time of writing, the market ranges around $19k and has not yet reacted in any significant way. At one point, Bitcoin dropped to $18,700 but has since bounced and regained the formerly reached area. But will it hold the old highs as support or will it crumble?