2023-04-25 18:36:37
On April 12, the long-awaited update, the Shanghai or Shapella upgrade, took place on the Ethereum blockchain. This was the update which made it possible for the first time to allocate tokens previously tied up in staking contracts. This was the last key step following the proof-of-stake transition last year. The native token of the Ethereum network, ether, was able to show a serious price increase following the Shanghai update. But that disappeared when a fairly serious selling wave swept through the market last week due to macroeconomic concerns.
Everyone wants to stake Ethereum following Shanghai
However, following the Shanghai update, the largest institutional-level staking providers, Bitcoin Suisse, Figment, Kiln, Staked.us and Stakefish, staked a total of 235,330 ether according to recent data. Overall a Dune Analytics according to its statistics, investors invested nearly 600,000 ether in staking contracts in this period. The value of the inflow exceeded 1 billion dollars. This was the largest weekly influx ever in the two and a half year history of ether staking. The increased interest also shows that payments from Ethereum’s proof-of-stake chain, made available once more by the Shanghai update, have reduced the liquidity risk that tying tokens previously posed.
Another driving force behind the large influx may be that a significant number of investors decided to re-stake most of the previously acquired and now distributed rewards. In the first 8 days following the Shanghai update, investors withdrew a total of 900,000 ether as staking rewards. During this period, staking payments exceeded 667,000 ether. This is 8 times as much as the total staked by investors in the 8 days before the update. If we don’t take rewards, more money comes into the network than leaves. This is worth highlighting, because by default the rewards are not worth keeping on the network due to the logic of Ethereum’s staking system. At least not in the given validating node, but for another 32 ether it is worth starting another node.
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