For ETH stakers, the Ethereum Shanghai upgrade is a well-awaited change as they will be able to remove their staked funds as validators. Aside from its effects on staking, it’s also ETH to new heights in the cryptocurrency market.
Ethereum, an open-source blockchain with smart contract functionality used to run on Proof-of-work, which made the mining process expensive and energy intensive. After the merge, Ethereum’s mechanism shifted from Proof-of-Work to Proof-of-Stake, a method for validating entries into a distributed database and keeping the database secure. Now, what changes Ethereum Shanghai Upgrade brings for ETH holders?
The Ethereum Shanghai Upgrade Will Have a Huge Impact on ETH
In March 2023, the Shanghai/Capella fork will go live. Jack Niewold, Founder of Crypto Pragmatist, an email newsletter on the narratives and assets shaping crypto, recently tweeted,
“about 14% of total ETH supply is staked, and it can be unstaked after the Shanghai fork. This makes some people bearish”
On Monday, Ethereum’s core developers deployed the first mainnet shadow fork designed to test the readiness of ETH staking withdrawal capability. This brought ETH holders one step closer to accessing the $26 billion worth of Ethereum.
Read More: Ethereum Shadow fork Goes Live: Here’s 7 Things You Need to Know
Withdrawals and ETH Developers Feud
Where the Ethereum merge introduced the ability for users to deposit ETH with the network, The Shanghai upgrade will allow ETH holders to stake their coins since the Beacon Chain, Ethereum’s Proof of Stake consensus layer. However, some of Ethereum’s devs believe the team is rushing the Shanghai upgrade. Micah Zoltu, an Ethereum dev, stated that the current Shanghai code does not allow ETH withdrawals to be compatible, and a rushed launch will create more problems for both developers and holders. They believe that the unstaking of ETH is acceding to public demands and not so much about the long-term health of Ethereum.
Also Read: 5 Ethereum Stocks To Indirectly Reap The Benefits Of Ether’s Surge
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