Ethereum is being locked up in DeFi [Decentralized Finance] contracts at an accelerating rate this year, while the quantity persisted centralized exchanges continues to fall.
Today on 7th May, on-chain analytics provider, Glassnode, shared a chart comparing the amount of Ether deposited in Ethereum-based smart contracts to the amount of ETH persisted centralized exchanges over the past 17 months.
Since the beginning of last year, the share of supply represented by Ether on centralized exchanges has dropped by over 1/4, from roughly 17% to 12%.
Over a similar period, the share of ETH locked in smart contracts has increased by three quarters, from 13% to 22.8%, revealing that DeFi is steadily eating into centralized exchanges’ profits from Ethereum trading fees.
Figures from cryptocurrency data aggregator DeFi Llama suggest that ETH like roughly 9% of the availability is locked in smart contracts hosted by networks aside from the Ethereum mainnet.
DeFi Llama estimates that 8.3 Mln coins or 7% of circulating Ether are locked in Binance Smart Chain protocols, while 286,153 Ethereum or around 0.25% of supply is on Solana, along with 103,902 ETH 0.09% is on Avalanche. Roughly 1.6% or 2.8 Mln Ether is locked in “other” networks.
Ether’s dramatic rally into new all-time highs above $3,500 USD has renewed discussions of a ‘flipping’ over Bitcoin [BTC], with Ether futures volumes briefly outpacing the BTC markets within the week.