Early in the morning, while checking on-chain data, I jumped up from my chair—another ETH whale has started the "buying and locking" mode. Overnight, this address deposited 118,000 ETH (equivalent to $350 million) into a staking contract, bringing the total locked amount to nearly $1.37 billion. This is no longer just simple "HODLing"; essentially, it's eating up ETH's on-chain liquidity.

As someone who has been involved in the crypto market for many years, I believe the subsequent impact of this move could be much more profound than expected. Let's clarify the reasoning.

The logic behind ETH staking is quite straightforward: lock tokens in a consensus layer contract, participate in network validation, and earn rewards. The key point is that unlocking requires waiting for a specific period, effectively "freezing" circulating ETH. Usually, decentralized staking is a healthy sign for the ecosystem, but when whales concentrate their actions, it’s a different story.

According to on-chain data tracking, this whale has been frequently increasing its holdings since last month and has now become the fifth-largest staking address on the network. Its staked ETH accounts for 0.8% of the total circulating supply. It may not seem like much, right? But the problem is that the current ETH staking rate is only 18.2%. Concentrated staking by a single address will directly reduce tradable chips in the secondary market, ultimately leading to a "liquidity drought."

Some might say, "Less chips are a good thing, right? Scarcity drives up ETH prices." I have to pour cold water on that—while this may have a short-term effect, the long-term health of the on-chain ecosystem will be genuinely impacted.