Ethereum successfully completed its Shanghai upgrade at 22:27 UTC on April 12, according to various update status pages.
Validators can now withdraw staked ETH
The Shanghai Ethereum upgrade introduces an important new feature that allows validators who previously staked ETH on-chain to withdraw these tokens for the first time.
However, the upgrade will not flood the market with ETH. Ethereum will only allow 1,350 full validators to withdraw their stake every day for the next 18 months. Since each validator stakes 32 ETH, no more than 43,200 ETH ($83 million at current prices) can enter the market per day – and all validators are unlikely to withdraw their ETH.
According to data from Nansen170,689 ETH are awaiting full release and 4,799 validators are awaiting full release, which is approximately 1% of stakers and ETH staked.
However, more pessimistic estimates suggest that up to 1.54 million ETH could be withdrawn soon after the upgrade due to different partial withdrawal rules. Other estimates suggest the upgrade resulted in $5 billion in unrealized losses.
Third-party staking platforms, on the other hand, operate on their own schedule. Lido, for example, has suggested that users will be able to start withdrawals around May.
Shanghai also includes other enhancements, such as a basis for conditional or voidable payments, features that will reduce contract size and some contractual risk, and enhancements that will reduce gas costs for developers.
Shanghai is just one step on the ETH roadmap
Shanghai represents the most significant Ethereum development in months, and the event has been widely observed. ConsenSys has launched a series of Commemorative NFTswhile its MetaMask wallet project has provided user guide and warned of scams.
Despite the anticipation, prices fluctuated only slightly at the time of the event. ETH saw slight gains, with its price rising 0.2% over the hour and 1.3% over 24 hours. Bitcoin, on the other hand, rose 0.0% and fell 0.9% over the same period.
Previously, Ethereum had undergone another significant upgrade called the merger. This upgrade took place in September 2022 and saw Ethereum move completely from proof-of-work (also known as mining) to proof-of-stake.
And while the merger represented a complete shift in staking, validators were able to deposit their stake as early as November 2020.
The next Ethereum major is titled Cancun. It will feature proto-danksharding, a feature that aims to improve scalability by improving transaction fees and times.