Ethereum "Shanghai Upgrade" Hard Fork to be Implemented in March, Unlocking Locked ETH Staking Posing Potential Selling Pressure?
Ethereum core developers have confirmed in a conference call that the first major upgrade after the merge, the "Shanghai Upgrade" plan, will be implemented in March. At the same time, the Ethereum unlock feature has been listed as a top priority by developers. After two years, Ethereum is no longer the $400 it was when staking was first introduced. Will this potentially create selling pressure on Ethereum?
Table of Contents
Shanghai Upgrade
According to the developer meeting, several key points were discussed:
1. Shanghai Hard Fork Upgrade Expected to Be Implemented in March
Prior to this, there was no specific implementation time for the Shanghai hard fork, but with developers discussing the priority order of introducing various functions, the target release time has been set for March.
2. Unlocking Function a Priority
The EIP 4895, which brings staking unlocking functionality to the beacon chain, has been prioritized by developers. The Ethereum mainnet deposit contract was initially opened on November 4, 2020, but the withdrawal function has yet to be realized after two years.
3. EVM Object Format, EOF
Developers have tentatively agreed to implement the EVM Object Format, EOF, as part of the Shanghai upgrade. This is a major upgrade for the Ethereum Virtual Machine (EVM) and includes the following proposals:
EIP 3540
EIP 3670
EIP 4200
EIP 4570
EIP 5450
4. Some Schedules Postponed to Autumn Major Upgrade
Developers noted that if the EVM Object Format is too complex and consensus is not reached at 1/5 of the developer meeting, the implementation will be postponed to the autumn upgrade.
The EIP-4844, previously seen as a significant scalability improvement, has also been delayed for implementation until autumn.
In November, OP Labs CEO Liam Horne emphasized that EIP-4844 has undergone more than nine months of iteration and can reduce Ethereum costs by 100 times; Ethereum founder Vitalik Buterin believes that EIP-4844 is the first step in significantly reducing L2 costs, making DApps more accessible to users.
Potential Selling Pressure?
The Ethereum mainnet deposit contract address was first released on November 4, 2020, with a total of 1,558 ETH, valued at approximately $19,994,506,805 before the deadline, nearly $20 billion.
Considering that the ETH price was only around $400 at that time, this means that some stakers have unrealized profits of over 200% based on the current ETH price.
However, as liquidity staking has become mainstream, data shows that Lido alone occupies 30% of Ethereum nodes, and Coinbase and Binance staking services have also introduced staking tokens such as cbETH and BETH, meaning that most users can withdraw Ethereum staking at any time.
Furthermore, Ethereum has a unlocking sequence mechanism, with each epoch lasting 6.4 minutes. Each epoch can allow 4 to 6 validators to exit based on the number of validators, so even if all validators exit sequentially, it could take several months.