Here is why Ethereum will experience a market increase this week

Temitope Akintade
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One of the most exciting developments is happening in the decentralized finance (DeFi) space this week: the Ethereum Shanghai Upgrade to be known as the Shapella upgrade. Industry experts have predicted that the momentum before and after this event would push the Ether market price above the $2,000 level.

The upgrade, scheduled for Wednesday, will allow network validators to withdraw funds locked to secure the Ethereum network since December 2020. The upgrade will complete the network’s transition to a proof-of-stake system, which started in October 2022 with the Merge.

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All you need to know about Ethereum’s upcoming Shanghai Upgrade

Around 30 billion worth of ETH will be available for withdrawal following Shanghai. In the long run, the ability to unstake Ether will de-risk the ETH investment tremendously. Institutional investors that couldn’t get involved earlier in staking will feel more comfortable once ETH can be unstaked. More capital entering ETH staking will improve the network in the long run.

General benefits for the Ethereum network 

The upgrade is one of the most significant developments to the Ethereum ecosystem since the Merge, which took place in September of last year. It promises to bring many benefits to the network, including the ability to withdraw assets from The Beacon Chain.

Ethereum

​​Another key feature of the Shapella Upgrade is the expected lowering of gas fees for developers. This change is likely to attract more developers to the platform, because it will make it more cost-effective for them to create and deploy smart contracts and decentralised applications.

The upgrade is also expected to provide a more seamless and efficient way for users to earn staking rewards while still retaining the ability to use their ETH for other purposes.

How will this affect Ethereum price? 

Industry experts see this Shanghai Upgrade as bullish for Ether in the long and short term. For instance, the Shanghai buzz has helped Ether outperform Bitcoin so far in April.

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After facing resistance at $2,000 and experiencing a stalled rally, Ethereum (ETH) is now in the spotlight, and the emergence of different entities offering re-staking services will be interesting to monitor, as it could potentially affect the value of ETH. 

The process of restating can prevent an overflow of unstaked ETH in exchanges, reducing selling pressure, and, combined with ETH burn, potentially driving it to its bullish target of $2,000.

A known crypto analyst on Twitter projects that if Ethereum breaches $2,000, it could trigger an altcoin rally. He pointed out that technical analysis suggests that Ethereum looks great in the short term.

Therefore, here is a perfect opportunity to scoop up some market gains from Ether.

Conclusion 

The Shapella Upgrade is a significant milestone for Ethereum, propelling the blockchain closer to becoming a more scalable and efficient platform. Also, the upgrade represents a game-changing development that positions the network for sustained growth and success.

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Although some short-term market volatility is expected, the long-term benefits to the ecosystem are substantial, as Ethereum’s capacity to handle more transactions per second increases, transaction costs decrease, and the security and efficiency of smart contracts improve. Lastly, with the Shapella Upgrade, the liquid staking landscape will be transformed forever, and Ethereum will become the benchmark yield for crypto.

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In a nutshell, the Shapella upgrade is shaping up to be another turning point for the Ethereum ecosystem, with a range of significant benefits that will attract more users and investors to the network.

This content is for informational purposes only and should not be construed as investment, tax or legal advice. It is strongly recommended that every recipient seek appropriate independent professional advice before acting on any information contained herein, as Technext provides no endorsement, opinion or advice, including investment, tax or legal, and makes no representation or warranty about the suitability of a product for a particular reader or circumstance.


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