Ethereum Shapella goes live on mainnet

It has been a while since Ethereum’s The Merge went live. Ethereum is now back with the second major upgrade – Shapella -and it has important benefits to offer to the community of developers and users. To start with, Ethereum Shapella optimizes the cost for certain transactions. While details are limited to this single statement, it is right to assume that the economic angle is not far from being transferred to users.

Next comes what has frequently been the center of discussion. Developers and validators can now leverage the capability of Shapella and withdraw their staked ETH from the network.

Per the development, the community has two options when it comes to withdrawing their staked ETH. These are partial and full withdrawals. Both have been discussed before the implementation of Ethereum Improvement Proposal 4895, also known as EIP-4895.

Released on the mainnet at epoch 620,9536, this marks a significant change for Ethereum wherein funds that were previously not accessible have been unlocked.

Circling around the types of withdrawals under EIP 4895, users and validators can either withdraw the entire staked ETH or a part of it, depending on their needs. Before proceeding further, it has to be noted that not the entire ETH on the network is currently available for withdrawal. Makes sense considering it would only lead to sharp fluctuations in the price of Ethereum.

Choosing partial withdrawal will see Ethereum automatically distributed among validators while making sure that the balance remains at 32 ETH, a point that is necessary to maintain the status of a validator. Next, full withdrawal involves shutting down the validator altogether for the purpose of withdrawal of staked funds.

Reportedly, 18 million ETH is in the network. This roughly converts to $33 billion. Withdrawals, partial or full, carry the potential to bring fluctuation in the ETH price. The graph is at its lowest point, with holders not really looking to sell their stake. Will Ethereum go up is a prime prediction to be made. Until then, holders are willing to put a halt on their plans of selling or withdrawing the staked fund. Ethereum is trading around $1,917.82 at the time of drafting this article.

Alexander Esin, the Chief Executive Officer of P2P.org, has shared their thoughts with the media stating that most of the holders are underwater at the market price that prevails at the moment. Esin has further added that a lot of holders are actually committed to Ethereum for a long period of time.

The CEO of P2P.org has also said that they believe that ETH that is withdrawn will be restaked to new validators to compound rewards.

ETH is believed to be at its lowest price, with speculation that it will enter the bullish phase in the days to come. Holders who are sticking to the ether for a long time are less likely to be affected by the fluctuations that may arise out of Shapella implementation. The same cannot be said for short ether runners.