The Ethereum community is enthusiastic as the highly-anticipated Shanghai upgrade is poised to poised to begin unlocking 17,000,000 ETH tokens on April 12, 2023. However, a prominent crypto influencer on Twitter has raised concerns about potential short-term repercussions, despite acknowledging the positive long-term implications for the crypto market.
“The anticipation surrounding the significant unlock event is expected to add an intriguing element to the market,” noted Crypto Tony, an influential figure in the industry. However, there are concerns of a potential market downturn, which could result in a significant sell-off.”
The upcoming Shanghai upgrade of the Ethereum blockchain is set to introduce a groundbreaking feature that will allow investors to withdraw their staked rewards. This development is expected to unlock a staggering $32 billion worth of ETH tokens for trading on the market. However, some experts predict that this influx of liquidity may trigger a downward trend in the market.
Per verified sources, the unlocking mechanism is subject to fluctuations based on the count of validators departing from the network. In the event of a validator’s exit, they would be placed in a queue and required to undergo a withdrawal period, spanning either 27 hours or 36 days, before the withdrawal is deemed complete. The rationale behind the significant variance in waiting periods is to discourage malicious intent from potential bad actors.
According to recent statistical data, a significant portion of the total supply of various proof-of-stake (PoS) cryptocurrencies is being staked by users. Notably, Cardano (ADA) boasts a 71% stake, Solana (SOL) holds a 70% stake, Binance Coin (BNB) has an 85% stake, and Polkadot (DOT) holds a 50% stake. These figures highlight the growing trend of users actively participating in the staking process of PoS cryptocurrencies.
While Ethereum, the leading PoS blockchain, currently boasts a staking rate of just 16%, its market performance has remained impressively steady. Despite only experiencing a modest 2% increase, ETH has maintained a stable value of $1,804 throughout the past week.
