Definition ∞ ETH supply lock refers to the quantity of Ethereum (ETH) that is intentionally removed from active circulation, typically by being deposited into staking contracts or decentralized finance protocols. This action restricts the immediate tradable supply of ETH. It signifies a commitment by holders to support network operations or participate in various ecosystem applications. A supply lock contributes to asset scarcity.
Context ∞ News reports frequently discuss ETH supply lock figures as an indicator of network health and investor commitment following Ethereum’s transition to Proof of Stake. An increasing locked supply can suggest positive sentiment and reduced selling pressure, potentially supporting price appreciation. This metric is a key data point for analysts assessing the long-term outlook for Ethereum and its ecosystem. It highlights participation in the network’s security and utility.
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