Research: As the merge approaches on-chain data suggests ETH used as store of value

According to on-chain data, arsenic the merge approaches, the ascendant behaviour crossed the Ethereum web is to HODL. Coins held by Ethereum investors are maturing to showcase a higher fig of HODLers unwilling to sell.

Within the Ethereum ecosystem, conscionable nether 60% of investors person held for much than 1 year, compared with Bitcoin, which has 80% of HODLers holding for the aforesaid play of time.

However, we are present seeing 7-year holders (dark blue) of Ethereum commencement to increase. From July 28, the archetypal 7-year holders began to amusement and present clasp implicit 2% of the supply.

Ethereum: HODL Waves (Source: Glassnode)

Given that Ethereum mined its archetypal artifact successful July 2015, coins that haven’t moved successful 7-years are apt genesis coins that person ne'er moved. As clip goes on, it is expected that the 7-year HODLers volition proceed to turn arsenic HODLers who entered the Ethereum ecosystem during the 2017 bull tally commencement to emerge.

Unlike Bitcoin, Ethereum is not often referred to arsenic a store of value. However, on-chain information suggests that 2% of Ethereum holders judge it could be. Depending connected the enactment of the network, Ethereum whitethorn besides beryllium deflationary aft The Merge, which adds credence to this theory.

Bitcoin has an in-built inflation rate of 1.7%, whereas Ethereum could spot deflation of 4%, astir 6% little than Bitcoin. Yet, Ethereum has robust inferior crossed its network, truthful a deficiency of disposable ETH owed to investors holding could interaction the network’s performance.

Inflation is simply a instrumentality designed to promote spending. If Ethereum becomes deflationary, determination volition beryllium small inducement to transact connected the network.

Further, astir 32m ETH was sitting connected exchanges successful mid-2020. However, 2 years later, the magnitude of ETH dropped to conscionable 20m. The fig of semipermanent HODLers, ostentation rates, and proviso connected exchanges are important semipermanent trends required to recognize supply/demand dynamics

Ethereum: Balance connected Exchanges (ETH) (Source: Glassnode)

The station Research: As the merge approaches on-chain information suggests ETH utilized arsenic store of value appeared archetypal connected CryptoSlate.