According to CoinDesk, the supply of ether is growing, while the amount staked is nearing an all-time high. This is happening as the possibility of an ether exchange-traded fund (ETF) in the U.S. becomes more likely. The total number of staked ETH is currently at 33.3 million ETH, or 27.7% of the total supply, according to Julio Moreno, CryptoQuant's head of research. This increase in the supply of the second-largest cryptocurrency indicates its return to being an inflationary asset, which could undermine its ability to act as a store of value over time. However, methods such as staking and burning can counter this.
The total supply of ETH is at its highest level since December 11, 2023, according to Moreno. He also noted that spot trading volume data suggests that ether could be as liquid as bitcoin, with ETH spot trading volume being 80%-90% of that of bitcoin in recent weeks. CoinMetrics data shows that about 12% of ether's supply is being used in smart contracts or bridges that connect between blockchains. Between that amount and the tokens that are staked, roughly 40% of the cryptocurrency is 'locked' and not being actively traded.
The race to launch an ether ETF is intensifying, with Polymarket bettors predicting that trading will begin before July 26. Recently, Invesco and Galaxy announced they will charge a 0.25% management fee for their proposed spot ether ETFs, slightly higher than VanEck's 0.20%. However, before trading can begin, the SEC must provide feedback on the current applications, and issuers need to file final amended forms with fee information and other required details. On Kalshi, bettors are giving a 65% chance that ether will outperform bitcoin, but are 95% sure that ether won't hit an all-time high before its larger peer.