ETH unlock report
In this report, we will focus on the amount of ETH that has been removed or added to validators after the Shanghai upgrade, and the trend that it has created.
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The Shanghai upgrade took place on April 12, 2023 on the Ethereum blockchain, allowing users to unstake their coins from validators after many years. As of May 8, 2023, 17.99 million ETH (14.86% of the total supply of 120,334,924 ETH) is staked with validators.
Since the option to unstake has become available, over 2.43 million ETH has been withdrawn but also 2.45 million ETH has been staked with validators.
There is a noticeable downward trend in the outflow of ETH from validators, but it is nothing drastic, and it is also evident that users are withdrawing their long-staked ETH for purposes other than rewards, while still leaving some staked with validators.
This is confirmed by the graph, which shows us the withdrawals in hourly intervals over the last 24 hours. At some points, the withdrawal amount did not even exceed 100 ETH per hour.
According to the latest information, the downward trend in ETH withdrawals is subsiding. In fact, over the last 24 hours (as of May 8, 2023), it has decreased by 2,237%.
Impact
Since the introduction of unstaking on April 13, 2023, the price of ETH has risen from 1,889 to 2,098 USD. During this time, approximately 2.4 million ETH were unlocked and could have been released onto the market. It is evident that ETH has strong user support, as many believe in its bright future and have thus chosen to leave their ETH with validators.
The slightly decreasing trend in newly staked ETH with validators is not particularly noticeable in terms of the overall amount of staked coins, and future growth is not excluded, as the APR for validators remains above 5%, which is quite attractive.
Opportunity for investment
Ethereum is a stable blockchain whose functionality has been verified over many years. Investing in its native cryptocurrency, ETH, carries one of the lowest risks in the crypto world.
Our analysis of the Ethereum blockchain can provide you with useful information and insight into what this project offers. However, remember that no analysis or recommendations can replace your own research and responsibility when making investment decisions.
Analyst opinion
Personally, I expected a greater drop in price during the first few days of unstaking. I was surprised that the opposite happened, and that users are not withdrawing their ETH at as rapid a pace as I would have assumed. In my opinion, this is a good indicator for the future functioning of the network, as it has a strong user community and many corporations behind it, who could have withdrawn their ETH after a long time (if they are not bound by a smart contract lock), but they have instead not chosen to do so. This can only be a positive for the blockchain.
Ondřej Tittl
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