The Shanghai upgrade’s successful launch has led to a 6% increase in Ethereum’s (ETH) price over the last 24 hours. As a result, the altcoin’s value has increased to $1,984, reflecting an 18% gain over the last 30 days and a 65% rise since the year 2023 began. Analysts have cautioned, nevertheless, that the introduction of staking withdrawals would result in further selling pressure for ETH.
Despite this, daily withdrawal restrictions are anticipated to minimize any possible price declines by preventing a sizable influx of ETH to the market. Additionally, the successful implementation of withdrawals may increase interest in ETH staking among retail and institutional investors.
The 30-day moving average is above the 200-day average, pointing to a breakout rally, while the relative strength index for ETH has surged over 70 in the most recent few hours, showing strong momentum.
If ETH can successfully break over the $2,000 resistance level, it might indicate more consolidated gains. Given the successful completion of the Shanghai project, which has encouraged investor optimism, this now seems to be feasible.
As Shanghai will essentially free roughly 16.3 million ETH (worth about $30.5 billion), several pundits have expressed worry that this might lead to a selloff in ETH. However, just 5% of the staked amount and 1.3% of the total Ethereum in circulation are represented by the amount of ETH that is awaiting withdrawal.
With restrictions placed on the amount of validators who may complete full withdrawals each day, it is anticipated that the unstaked ETH will eventually enter the market. Since Shanghai is more of a net gain than a net loss for Ethereum, the rise in ETH’s price implies this.
If Shanghai’s launch is successful, over 60% of Ethereum’s entire supply may be staked, removing millions of ETH from circulation and increasing demand for the alternative currency. This shortage of supply, together with the burning of fees from EIP 1559 last year, may cause ETH’s price to rise significantly over the next several months.
By the middle of 2023, the price of ETH may reach $3,000, and by the beginning of 2024, it might even reach $4,000. ETH is anticipated to surpass its current record high of $4,878 if the upcoming Bitcoin halving does trigger a new bull market in 2016.