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- 1 Core Ethereum developers confirmed that Ethereum staking withdrawals are pushed to mid-April.
- 2 Goerli testnet will be launched in mid-March as a test run for Shanghai Upgrade.
Ethereum is the world’s second and most active blockchain; its hard fork from Proof-of-Work (PoW) to Proof-of-Stake (PoS) took place on September 6, 2022. Causing a paradigm shift where staked ETH was the new oil. People are awaiting the Shanghai upgrade, facilitating withdrawal of staked ETH, which is supposed to initiate mid-April, core developers confirmed on Thursday.
The Shanghai upgrade & Goerli testnet
The network’s core developers believe the fruition could happen in the first two weeks of April 2023. At its inception, the upgrade was slated for a March release, while some developers even dreamed of it coming out in January itself, as reported by the media.
The developers’ team plans to launch a Goerli testnet, an all-inclusive dress rehearsal before the Shanghai upgrade, to pinpoint the pressure points and fault lines. The proposed release date is on or around April 14, 2023. If all goes according to plan, the actual Shanghai update could go live in the second week of April.
Implications of the Implementation
Due to its huge financial implication, the implementation procedure of the Shanghai upgrade is being closely watched. The shift to the PoS model was crucial as it required transactions to be validated by users who staked ETH on the network. Their validation service granted them rewards in the form of newly generated ETH.
ETH staking began in December 2020, and from that time, nearly $28.7 million ETH was deposited on the network, and the number is still rising. The amount equals nearly 14.5% of total ETH circulation. These accumulated rewards were, until now, unavailable for withdrawal. The upgrade would allow its withdrawal, one of the main reasons for the buzz.
Major entities which lead the race are intermediary staking services like Lido and certain exchanges like Cinbase, Kraken and the world’s top exchange. As per Dune Analytics, the combined pool of these four parties currently accounts for 56% of all ETH staked with the network.
Many of these firms suffered badly in the crypto winter, and this inflow could greatly help them. For instance, JP Morgan analysts suggested that the upgrade could bring new life into the struggling crypto exchange Coinbase. Further estimates suggest that the exchange might earn between $225 million and $545 million in revenue annually.
Efforts to Launch it ASAP
As its importance is well established, core developers at Ethereum are trying everything to get it out as early as possible. They even removed the additional features and much-required improvements to the Ethereum network from Shanghai to speed up its release. Some minor technical tweaks for its encoding methods to the upgrade were also avoided. Although these steps could launch the upgrade early, they would surely cost the network in the future.
Core developer Micah Zoltu protested this decision of favoring Shanghai over others in a developer meeting on the subject held in January 2023. Arguing that they are not thinking about the long-term health of Ethereum and focusing their efforts on what people want now, at this instance.
All the sacrifices and hardships could now be for nothing if the Shanghai upgrade fails to be out on its slated release date. Moreover, it functions in the desired way.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
