ETH Hovers Around $1,900 A Day Before “Shapella”
Throughout Tuesday, April 11th, Ethereum was maintaining a price close to $1,900, albeit it was declining slightly throughout the day. Wednesday, on the other hand, might prove a more exciting day, as the world’s second cryptocurrency is set to go through long-awaited upgrades—Shanghai and Capella.
ETH Slightly Declines in Anticipation of Shanghai and Capella
Throughout Tuesday, April 11th, Ethereum maintained the price of about $1,900 which it had reached on the eve of its long-awaited “Shapella” upgrade scheduled for this Wednesday. After suffering a decline throughout 2022—along with much of the digital assets industry—the world’s second-largest cryptocurrency has been slowly but steadily rising since January 1st, and is up nearly 58% YTD.
April 12th is bound to be a big day both for the cryptocurrency and for its blockchain. The so-called “Shapella” upgrade—know as such as it is actually two upgrades implemented at once—is the first major development since the much-celebrated “Merge” which brought ETH’s emissions down by 99% in September.
The upgrade is composed of two distinct parts—Shanghai and Capella. Shanghai will affect the consensus layer, while Capella concerns the execution layer. The two will finally unable the unstaking of staked Ethereum which is widely expected to lead to the proliferation of so-called liquid staking.
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Platforms and Investors Brace for the Upgrade
Considering the importance of “Shapella”, investors and platforms alike have been preparing for its execution for months. For the most part, companies have announced they will enable their users to unstake their ETH fairly quickly after the upgrade—Coinbase, for example, stated it would be available 24 hours after the execution—but pointed out that there no reason for users to do so unless they specifically want to.
The only exception to this is the cryptocurrency exchange Kraken. Due to a recent settlement with the SEC, all ETH staked through the platform will be unstaked at the first opportunity and the entire service will be shut down. While most users will not have to do anything for their Ether to go through the upgrade, the devs offered some instructions for node operators and other stakers on their website.
Considering that the upgrade will enable unstaking thus unlocking a great amount of Ethereum, there have been some fears about how it may impact the price. Recent data, however, hints that there should be no major impact on the price as, according to Glassnode, a lot of the staked ETH comes with a lot of unrealized losses thus disincentivizing most investors from selling—especially now when the cryptocurrency market is going through a significant rally.
Do you think the upgrade will have a significant impact on the price of ETH? Let us know in the comments below.