- Ethereum Shapella Upgrade went live on April 12 at 6:30 ET.
- Unexpectedly, the ETH price has risen by 2.38% in the last 24 hours.
The Ethereum Shapella Upgrade went live, seeing a mere hike of 2.38%, which goes beyond the unexpected. On April 12, the Ethereum network’s hard fork took place, allowing the stakers to finally un-stake ETH. Rumors were circulating that this could bring the price down due to added selling pressure, but the price more-or-less remained relatively stable.
The Effect of Shapella Upgrade on its Price Action
When writing ETH was trading at $1,915.81 after a jump of 2.38%, its value against Bitcoin gained 2.09% to 0.0637BTC, its market cap hiked by 2.38% to $230 Billion, and the trading volume increased by 28.34% to $11.05 Billion.
Compared to the last hard fork, Ethereum Merge dropped on September 15, there was a drop of almost 10%, and then it went into consolidation for weeks.
The relative stability of the ETH price point after the Ethereum Shapella Upgrade was not expected. Traders generally tend to buy in a major event that could impact the price, as they expect it to go down. Some traders might have tried to replicate the profits earned during the Merge but failed.
With the results at hand, it can be said that the Shapella Upgrade could not create a significant impact on the Ethereum ecosystem. Also, the last update made a paradigm shift from energy-intensive Proof-of-Work (PoW) to Proof-of-Stake (PoS), which was a big deal. Validators staked around 32 ETH and were to be rewarded for their participation in the new upgrade.
The new Ethereum Shapella Upgrade allowed those staked ETH to be un-staked and was not as important of a shift as the previous one. It opened up nearly $3.37 Billion worth of staked ETH, which were locked for the last three years.
However, studies revealed that only around 29% of it was profitable in US Dollars, this fact could be among the reason for the outcome.
Possible Reasons for the Unexpected Outcome
Analysts argue that the Ethereum Shapellla Upgrade was neither a notable nor a tradable moment in the network’s history. The major reason could be that most of the staked ETH were deposited on the network through intermediary staking pools and crypto exchange. The customers were provided staking tokens in return. Moreover, most of the capital was locked before Shapella had been liquid for some time.
Liquid staking platforms like Lido or Rocket Pool allowed the selling of the staked ETH, even before the upgrade went live. Hence, it can be assumed that the fork could not create the expected impact.
The withdrawals were supposed to begin in a scheduled manner from May 2023, and there were also issues with the seamless upgradation of computers. Although the price movement was unexpected, the Ethereum Shapella Upgrade is still a major one in the line-up and will be followed by Verge and Purge in the future.
Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.
Source: https://www.thecoinrepublic.com/2023/04/13/ethereum-shapella-upgrade-goes-live-but-price-stays-steady-why/