Ethereum (ETH) Price Shoots Closer to $2,000 A Day Before Shanghai Upgrade

The Ethereum blockchain network is all set to undergo the much-awaited Shanghai upgrade scheduled on Wednesday, April 12. The world’s second-largest cryptocurrency Ethereum (ETH) is up 3.5% and is currently eyeing $2,000 levels.

As of press time, ETH is trading at $1,919 with a market cap of $231 billion. The Ethereum Shanghai upgrade is crucial from the point of view that it will allow the withdrawal of all the staked ETH since the launch of the Beacon Chain.

There have been concerns in the market that the increase in ETH supply by allowing the withdrawal of staked ETH will put major selling pressure on the Ethereum (ETH) price.

However, some market analysts predict that not every validator is going to unstake or withdraw their entire ETH soon after Shanghai. Some might prefer withdrawing only the staking rewards while keeping the actual staked ETH untouched.

Thus, it could abate the selling pressure after the Shanghai upgrade goes live. Also, on-chain data from CryptoQuant shows that more than half of the staked ETH is currently still at a loss. Thus, it is far more unlikely that most validators will make an exit at this point.

With the current ETH prices, more than half of the staked ETH (9.7 million out of 17.9 million) is currently at a loss. pic.twitter.com/232BRTOIb7

— CryptoQuant.com (@cryptoquant_com) April 5, 2023

On-Chain Data for Ethereum (ETH)

On-chain data from Glassnode shows that the Ethereum (ETH) depositors are showing kind of a mixed behavior. While there’s a flood of recurring depositors on a daily basis, major events like The Merge, Shanghai upgrade, etc. see a surge in one-time depositors. Glassnode states:

The #Ethereum staking pool is mainly composed of recurring depositors owning multiple validators, making up to 1000 deposits daily. However, major events such as the Beacon Chain genesis, the Merge, and the upcoming Shanghai upgrade have seen a surge in one-time depositors.

Furthermore, Glassnode explains that the unrealized losses on the Ethereum Beacon Chain as still close to $5 billion. However, it is significantly down from the peak of $16 billion during the LUNA collapse. The data-provider notes: “The largest of depositors (+500 Validators) are experiencing the highest degree of financial pain, holding 70% of the unrealized losses”.