Market Analysis Report (13 Apr 2023)

Ethereum’s widely-anticipated Shapella hard fork has gone live on the cryptocurrency’s mainnet, implementing with it Ethereum Improvement Proposal (EIP) 4895, which allows for the withdrawal of staked Ether (ETH).

Ethereum developers are keeping an eye on any possible problems that may arise from the upgrade’s implementation. The upgrade went live on the mainnet at block height 6209536. Along with the withdrawal mechanism, Shapella improved the network’s gas fees for some transactions, as the core team had explained on GitHub before.

The upgrade completes Ethereum’s transition to a Proof-of-Stake consensus mechanism and is widely expected to produce short-term price fluctuations as some of the staked Ether is withdrawn. Not all of the 18 million staked ETH will be available for withdrawal all at once due to limits on the amount that can be withdrawn.

With the Shapella upgrade, staked ETH can be withdrawn in two ways: partial and full. Partial withdrawals keep the validators running by automatically distributing the ETH to them, so they have the required 32 ETH balance. Full withdrawals stop the validator and take out the whole staked amount.

On-chain data has shown of all the validators moving to unstake, cryptocurrency exchange Kraken leads with over 60% of the exit queue breakdown. The number of validators in the exit queue surpassed the 15,000 mark.

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• Source: https://www.cryptocompare.com/email-updates/daily/2023/apr/13/