Ethereum has often been touted as the only cryptocurrency with the right technology, embrace, and functionalities to outrank Bitcoin (BTC) in terms of market capitalization.
The Ethereum network, dubbed the second-largest blockchain protocol by market capitalization, is set to undergo another significant upgrade dubbed Shapella. The Shapella upgrade is designed to usher in a new era wherein Ethereum staking products and services can produce rewards in a shorter time compared to the fund’s lockup model it is currently operating as.
The Shapella upgrade has been deemed as one of the most significant changes that will be made to the Ethereum protocol since the complete transition from the Proof-of-Work (PoW) to the Proof-of-Stake (PoS) consensus model. The significance of the Shapella Upgrade is further highlighted in the projected volatility that is likely to precede the funds unlocking.
Notably, as much as $30 billion worth of Ether tokens have been locked up in smart contracts dedicated to the Ethereum blockchain since as early as December 2020. With the upgrade, stakers will now have the ability to gain access to their tokens which many may choose to sell off.
Investors are already pricing in the potential selloff ahead of the designated time for the upgrade to go live which is set at 22:30 GMT according to a top developer, Tim Beiko.
At the time of writing, Ethereum is down by 2.52% over the past 24 hours according to data from CoinMarketCap and it is currently trading at $1,872.02. While this price point might not necessarily be a vantage point for some of the earliest stakers, the more than 60% growth recorded thus far in the year-to-date period can be considered a major win for some of the recent staking partners.
The Shapella Upgrade will create a dual twist for Ethereum holders with volatility tilted to the negative side most imminent in the near term.
General Outlook for Ethereum Post-Shapella Upgrade
Ethereum has often been touted as the only cryptocurrency with the right technology, embrace, and functionalities to outrank Bitcoin (BTC) in terms of market capitalization. There is a lot of perception surrounding the protocol in both the short and long term beginning with the Shapella Upgrade.
“The release of this previously unrealised investment may lead to significant downward price pressure if it is immediately liquidated,” Deutsche Bank analysts said in a note to investors highlighting the massive Ethereum coins that are set to be released for sale.
When the immediate volatility surrounding the selloff clears, there is also a projection that institutional money will flow into the Ethereum blockchain as investors are generally looking for new reward systems for their portfolios.
Ethereum’s market cap is currently about half that of Bitcoin, however, a sustained embrace from both corporate and retail buyers as well as the steady burning of tokens since the London Hardfork of 2021, Ethereum is setting a unique push that can generally help drive its price to new heights.
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Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.
Source: https://www.coinspeaker.com/ethereum-shapella-upgrade-live/