Since its launch, Ethereum has become the second cryptocurrency in the world in terms of market capitalization and the most popular altcoin globally. Its good reputation is also because the blockchain is well-recognized for its innovative qualities, being a pioneer in the fields of decentralized applications and finance. Over the last year, its native currency, Ether, was badly hit by the crypto winter and bear markets that affected the digital finance ecosystem.
However, in 2023, the market is on the mend, and investors are beginning to remake their portfolios. Considering that cryptocurrencies are still recovering from the difficulties of 2022, it’s time to examine some ways the digital asset environment could change over the following months.
The Shanghai Upgrade
Over the years, Ethereum has been at the forefront of innovation and technological development within the cryptocurrency backdrop. Recently, on April 12th, it finally launched its much-awaited Shanghai upgrade. As a result, the price has climbed over $2,000, the highest level in nearly a year, since May 2022.
In the days since the upgrade has gone live, exchanges have recorded an approximate inflow of nearly 180,000 ETH, the rough equivalent of $375 million. Between the 13th and the 19th of April, traders deposited over one million coins, compared to the 921,579 tokens that were removed. This has been the most significant net inflow in a month.
As for the effects this might have on the price point, analysts have pointed out that investors transferring coins to exchanges is a clear indicator they are preparing to sell, which can contribute to a price decline. The latest update has also enabled the withdrawal of staked contracts. Shortly before Shanghai was implemented, many investors were worried that this would cause the market to become flooded with millions of coins, leading to an inevitable crash.
While those grim predictions have thankfully not become a reality, it is still too early to determine the long-term implications of this latest upgrade and how it will impact both the Ethereum blockchain and the larger crypto environment.
The blockchain is an outstandingly large collection of immutable data that is stored in individual blocks. And while there are many advantages that come with its system, including transparency and the fact that nobody…
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