Unlocking $34 Billion in Staked ETH

GM Readers!📪 It's BitDegree Insider, and here's what our chef has prepared for you today.

⭐️Today's selection:

• 🔷The Shanghai Update
• 🧋Wednesday's Bubbles
• 👌Selected Meme of The Day
• 📰Bite-Sized News

THE SHANGHAI UPDATE

A big day for the Ethereum community. The Shanghai Update, also known as the Shapella Update, is knocking at the door!In case you're wondering, Shapella is a fusion of the names Shanghai and Capella, signifying two simultaneous network upgrades that will be carried out together.

Or in other words:

Unlocking $34 Billion in Staked ETH and Its Impact on the Market.

The highly anticipated update is finally here, with 18 million ETH worth over $34 billion, which was locked in staking, is set to be unlocked in approximately 6 to 7 hours.

This event has been surrounded by myths and misconceptions, fueled by the media's love for sensational headlines.

Many believe that stakers will rush to sell their ETH, causing the price to plummet.

However, there are reasons to believe that the impact on the market will be far more nuanced.

The Shanghai update marks a significant milestone in Ethereum's transition from Proof-of-Work (PoW) to Proof-of-Stake (PoS), following the launch of the Beacon Chain in December 2020 and the "Merge" in September 2022.

It introduces the ability for stakers to withdraw ETH locked since December 2020 and the rewards they've earned.

However, the withdrawal process will be gradual, with limits on daily withdrawals (no more than 115,200 ETH per day) and some users, like Lido stakers, having to wait until mid-May (Lido is about to introduce a v2 upgrade).

Despite fears of a sudden price drop, several factors suggest that the update may not be as detrimental to the ETH exchange rate as some predict:

• The Shanghai update's release date has been known for a long time, and the market has likely already factored it into the price.
• The increased demand for staking, as users no longer need to lock their ETH indefinitely, will offset the pressure on the price.
• Pool users have always been able to "withdraw" their ETH by selling liquid tokens (stETH, rETH, ankrETH, bETH, etc.).
• Only 31% of ETH stakers are currently in profit, meaning most would be selling at a loss. Therefore it would not be a 'smart move'.

Moreover, the Shanghai update is expected to attract more stakers, especially institutional investors, who have been waiting for the ability to withdraw their ETH at any time and increased confidence in the update's technical success.

If the number of validators decreases due to withdrawals, staking rewards will increase, attracting new validators.

It's important to note that the overall economic context will also play a role in ETH's price. As interest rates rise, the entire crypto ecosystem, including ETH, could face downward pressure.

For example, it's just been announced that the US inflation fell to 5%, which is lower than expected.

Such news immediately mixes everything up and applies newly-introduced pressures on the crypto market. Which may affect how strongly the Shanghai Update will affect the ETH price.

As always, it's crucial to conduct thorough research before making any investment decisions.

The update also brings improvements to EIP-3855, EIP-3860, and EIP-6049, which will optimize Ethereum and enhance its performance.

Instead of being a threat to the ETH exchange rate, the update offers exciting improvements that are likely to increase Ether's value in the long term.

So, while some selling pressure might be expected, it will likely be limited and balanced by increased buyer interest.

TL;DR: The long-awaited Shanghai/Shapella Ethereum Update is here. In a few hours, about $34 Billion worth of ETH, that's currently staked, will be unlocked, and the market will definitely react to it.

WEDNESDAY'S BUBBLES

As always, here's the market overview from a one week's perspective. In shape of bubbles.

It's worth noting that there is currently no altcoin season in the crypto market.

As it stands, Bitcoin maintains its stronghold with a commanding 47.5% of the market share.

Of course, the market can be unpredictable, so it's always a good idea to stay vigilant for any potential changes.

Btw, if you are not precisely aware of what altseason is:

Altseason is a time in the crypto market when alternative cryptocurrencies (altcoins) outperform Bitcoin and dominate the market.

Bitcoin has made it to the headlines again with a recent fact that:

A whale address was the recipient of a 23,500 Bitcoin transaction, worth ~$710M.

This was the 4th largest recorded transfer of the year.

Also, what's up with Solana, why is it green?

It appears that Solana is on the verge of launching its own smartphone - wow!

Marketed as the first Web3-mobile device, it boasts an array of unusual features (for a phone), including embedded access to dApps, token minting, and trading on platforms.

The smartphone was initially announced last summer, and in September, new details emerged. Solana Mobile vowed that their device would be a "killer" of Google and Apple.

According to reports, the Saga smartphone (that's how it's called) aims to offer the easiest and quickest access to the Web3 for users.

This, coupled with its decentralization, which is uncommon among large tech companies, will serve as the device's main competitive advantage.

Solana plans to leave the source code for the Saga Interface Control Document and Saga 3D Surfaces open.

This will enable third-party developers to build their applications on the platform.

In addition to the built-in dApps and tools, the Saga smartphone boasts a processor, camera, and premium display. It will be available for pre-order at a cost of $1,000.

All in all, it will be interesting to see what this device can do.

SELECTED MEME OF THE DAY

BITE-SIZED NEWS

• Ren Protocol Unveiled Plans to Move All Crypto Assets to FTX Debtors' Wallets. The move will ensure the safety of customer funds in case of a potential shutdown.
• Spanish Authorities Plan to Dispatch 328,000 Tax Notices to Crypto Investors. That's 40% more warning notices than in 2022.
• Metalpha Aims to Secure $100M Funding to Bring Grayscale Products to Hong Kong. So far, Metalpha has reportedly raised only 20% of the desired amount.