Ethereum heads to Shanghai for a USD 20 billion influx after Merge

Ethereum heads to Shanghai for a USD 20 billion influx after Merge

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On September 15, the massive upgrade to the Ethereum blockchain called ‘Merge’ reportedly went live, while smoothly transitioning it to a proof of stake (PoS) method that uses less energy.

Even though ether had climbed over 85% from its June lows in expectation of the event, it has since fallen 19% as a result of investor anxiety over price increases and central bank policy, including bitcoin and other risk-enabled assets. Despite this, a lot of industry participants are upbeat about the long-term possibilities of Ethereum and its native coin.

According to chief investment officer of asset management IDEG Limited, Markus Thielen, the previous approach to sovereign wealth funds and central banks to assist in developing their holdings of digital assets has rejected direct investment, owing to energy concerns.

However, with Ethereum shifting to proof of stake, this eliminates the concern of using digital assets, Thielen added. Furthermore, some crypto investors are presently emphasizing the next event that might affect prices.

Meanwhile, the Shanghai update, which aims to lower Ethereum's high transaction fees, is expected by market participants to arrive in around six months. It will also allow validators to withdraw their staked currencies and hold or sell them after depositing ether tokens on the blockchain in exchange for a yield.

It is worth mentioning that there are currently over USD 20 billion in locked-up ether deposits and there’s a lot at stake right now.

According to external sources, the staked ether cryptocurrency, which is seen as a gamble on Ethereum's long-term success seems as if it cannot be refunded until Shanghai takes place and is trading equally with ether at 0.989 ether, suggesting trust in future upgrades. For those unaware, the coin was at its lowest point in June, which was 0.92.

 

Source Credit:

https://www.reuters.com/technology/cryptoverse-after-merge-ether-heads-20-billion-shanghai-splurge-2022-09-20/