The second largest cryptocurrency by market cap, Ethereum (ETH), recorded a seven-month high on April 5 by breaking the $1,900 resistance level, and hitting $1,925, according to data from CoinMarketCap.
Ether is trading at $1,909 at the time of writing. CoinMarketCap data revealed that the last time Ether surpassed $1,900 was on August 16, 2022.
It is noteworthy that this incredible performance was recorded just a week before the staking withdrawals that are set to be enabled in the Ethereum Shanghai hard fork slated for April 12.
The Ethereum Shanghai hard fork will execute Ethereum Improvement Proposal (EIP) – 4895, which will enable validators and stakes to withdraw staked ETH from the Beacon Chain.
In the same vein, it is focused on facilitating transaction speeds while reducing transaction costs to the barest minimum.
Speaking on the upcoming event, crypto analyst Branimir Stojanovic asserted that approximately 16 million staked ETH will be available for withdrawal after the hard fork.
Alright, let's talk about the Ethereum Shanghai Upgrade! It's a hard fork scheduled to occur in March 2023. Stakers and validators will be able to withdraw staked ETH from the Beacon Chain. Approximately 16 million staked ETH will be available for withdrawal.
— Branimir Stojanović (@branelost) April 4, 2023
She further added that the project aims at orchestrating lower gas costs for Ethereum developers, stressing that withdrawal of staked ETH has been successfully simulated on the Zhejiang testnet.
In addition to EIP-4895, there are several other EIPs in the Shanghai fork, most of which aim to lower gas costs for Ethereum developers. The withdrawal of staked ETH has been successfully simulated on the Zhejiang testnet.
— Branimir Stojanović (@branelost) April 4, 2023
Meanwhile, it is believed that the recent price spike was propelled by expectations that the Federal Reserve may lessen its quantitative tightening efforts.
The market believes last week’s dovish 25 bps hike will be the Fed’s last and is pricing in rate cuts as early as June. Even the highest part of the forward curve is now below the current Fed Funds target rate. /1 pic.twitter.com/lrFm7KMP7Z
— Jurrien Timmer (@TimmerFidelity) March 27, 2023
Mixed Opinions Trail Withdrawal of Staked ETH
Against the backdrop of the fact that the Shanghai hard fork will lead to unlocking over 16 million staked Ethereum (ETH), there have been concerns on the potential impacts of that on Ether price.
Branimir Stojanovic remarked that, crypto traders are keeping eye on the Shanghai upgrade’s potential impact, with both bullish and bearish opinions on the spotlight.
Crypto traders are keeping an eye on the Shanghai Upgrade’s potential impact on the market, with both bullish and bearish opinions adding to the conversation. Exciting times ahead for the world of crypto! #Ethereum #ShanghaiUpgrade #CryptoRevolution}
— Branimir Stojanović (@branelost) April 4, 2023
It remains to be seen if unlocking staked Ether will create sell pressure that will adversely affect the price of Ethereum or not.
Interestingly, ETH/BTC trading pair shows that Ether outperformed Bitcoin by nearly 3% in the last week according to TradingView. Time will tell if ETH can consolidate the gains.
