- ETH has pumped more than 10% since the Shanghai upgrade.
- The last time ETH traded over $2,100 was almost a year ago.
- ETH withdrawals have significantly outpaced deposits.
Ethereum has just activated one of its most important upgrades in history. The Shapella (Shanghai and Capella) upgrade has enabled ETH staking withdrawals and finalized the blockchain’s move to the Proof-of-Stake consensus mechanism.
Many thought that enabling ETH staking withdrawals would negatively impact the price of ETH. However, not only has ETH not been dumped, it has pumped more than 10% since Shapella went live.
ETH Tops $2,100 Despite Withdrawals Outpacing Deposits
ETH has risen significantly in the past two days since the Shapella upgrade was activated.
The native currency of the Ethereum blockchain is currently trading at $2,110, up 10% on the day, according to data from CoinGecko.
In the last seven days, ETH has been up 12%. The last time ETH traded at $2,110 or more was in May 2022, during the Terra Luna crash.
ETH is trading higher despite staking withdrawals outpacing deposits. According to TokenUnlocks, since the Shanghai upgrade, 265,840 ETH have been withdrawn and 111,970 deposited.
However, there were a few moments on Thursday when ETH deposits significantly outpaced withdrawals. For example, at 12 PM, there were 27,008 ETH deposits versus just 7,615 withdrawals, according to Nansen.
In total, there are 17.4 million ETH deposited, with 1.1 million ETH ($2.33 billion) pending to be withdrawn. TokenUnlocks estimates an additional 42,000 ETH ($88 million) will be withdrawn in the next 11 hours.
On the Flipside
- The current ETH rally might be associated with a broader rally in the financial markets. All major cryptocurrencies pumped 5-10% in the last few days. Nasdaq rose by 2% and S&P 500 by 1.33% on Thursday.
Why You Should Care
ETH has been on an upward trend in the past few weeks, proving, at least for now, that the Shanghai upgrade has been a bullish event for Ethereum.
The Shapella upgrade allows investors to withdraw their staked ETH on the network.
The upgrades to the blockchain’s execution layer are referred to as Shanghai, while the alterations to the consensus layer are called Capella. Combined, they form the portmanteau Shapella.
“Ethereum 2.0” is a wide-ranging term that refers to the blockchain’s transition to a new level of increased scalability and accessibility. The shift from a Proof-of-Work to a Proof-of-Stake model in September 2022 was crucial in this development, while the term itself is now considered somewhat archaic.
The upgrade will increase the number of people staking ETH, making the ecosystem more stable and secure. The main risk was that there would be a sudden and dramatic withdrawal of ETH, which would cause its price to plunge, but this has not occurred.
Read more about how ETH reacted right after staking withdrawals were activated:
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