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Ethereum Now Has More "Hodlers" Than Bitcoin Thanks to Staking

ETH held by addresses for longer than 12 months is at the highest since at least 2018, with the ratio surpassing Bitcoin's for the first time ever.

By: Camila Russo • Loading...

Hands holding ETH

Ethereum staking is minting a record amount of "hodlers," with the ratio of long-term owners surpassing Bitcoin's.

ETH held by addresses for longer than 12 months -- or what IntoTheBlock calls the "Hodler Ratio"-- is at almost 72% of total ETH holders, the highest since at least October 2018, the data show.

Ethereum's "Hodler Ratio" crossed Bitcoin's in October, after surpassing it for the first time ever in August.

Long-term investors are important for the health of a Layer 1 chain. So-called "hodlers" provide stability and mitigate market volatility as they are less likely to sell in response to short-term market fluctuations.

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Hodler Ratio

Ethereum beating Bitcoin "hodlers" comes even as Bitcoin long-term investors increase. The Bitcoin ecosystem is observing the largest disparity on record between its long-term and short-term holders, according to Glassnode.

Read More: Disparity Between Bitcoin HODLers and Daytraders Hits Record

Staking Rewards

Ethereum's staking rewards are incentivizing ETH holders to own the chain's native currency for longer and to accumulate more of it.

"The increase [of long-term holders] is most likely related to the growth in staking this year," said Lucas Outumuro, head of research at IntoTheBlock.

The amount of ETH staked has nearly doubled in 2023 with about 24% of all supply being staked, Outumuro said. The average duration of funds held there is over one year, so this drives the "Hodler Ratio" higher, he said.

Ethereum's annualized staking rewards rate currently sits at 4.39%, according to stakingrewards.com. The rate is equivalent to the network's "risk free" rate, analogous to the yield on a 10-year U.S. Treasury note.

Ethereum Whales

Ethereum whales are also on the rise, though that number is more nuanced. Addresses owning more than 1% of the circulating ETH supply increased by 12 percentage points this year to 34.6%, according to IntoTheBlock. But the number includes staking contracts, which include many individual holders.

Out of eight Layer 1 chains tracked, only Ethereum and Cardano whales increased this year relative to the rest of holders, while whales in chains including Bitcoin and Avalanche declined.

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