Ethereum: Active validators bounce back as ETF dust settles

• Before the BTC spot ETF approval, the active validator count on Ethereum fell. 
• The network’s participation rate, which dropped before the ETF approval, has climbed.

The number of active validators on the Ethereum [ETH] Proof-of-Stake (PoS) network has seen a sharp uptick in the past week.

This is after a period of decline before the approval of the Bitcoin [BTC] spot exchange-traded fund (ETF), according to data from Glassnode. 

Information retrieved from the on-chain data provider showed between the 4th to the 12th of January, the active validator count on the Ethereum Network fell from 906,470 to 895,784. 

The decline began a day after crypto investment services provider Matrixpot published a report predicting that the U.S. Securities and Exchange Commission (SEC) would reject all Bitcoin ETF applications.

As many feared that the prediction might be accurate, leading asset prices plunged, causing over $500 million in liquidations.  

On the Ethereum network, voluntary validator exit climbed to an all-time high of 17,821, and the count of validators that participated in verifying transactions on the chain fell. 

However, this decline has stopped since the 12th of January. As of the 20th of January, 904,754 validators were active on the Ethereum network, marking a 1% uptick from the former low. 

Source: Glassnode

State of the PoS network

The missed block count touched a year-to-date high of 115 blocks on the 6th of January.

This was because of the hike in validator exit and because some validators took their nodes offline as the market awaited the SEC’s decision on the BTC ETF applications. 

A block is said to be missed when the validator charged with the duty of producing blocks for each 12-second slot is unavailable. Since the hike on the 6th of January, it has trended downward and fallen by 76%.

As of the 20th of January, only 27 blocks were missed. 

Due to the unavailability of a sizable number of validators on the Ethereum chain on the 6th of January, the network’s participation rate plummeted to a four-month low of 98.94%.

As validators returned online, this rallied and was spotted at 99.59% at press time. 

Read Ethereum’s [ETH] Price Prediction 2023-24

According to Glassnode, a high participation rate indicates reliable validator node uptime and, thus, fewer missed blocks and superior blockspace efficiency. 

As of this writing, the total number of validators on the Ethereum PoS network was 1.17 million. This year alone, the validator count on the chain has increased by 4%. 

Source: Glassnode