Ether Hits 11-month High as Post-Shapella Withdrawals Pass 1M ETH

More than a million Ether Within the first four days of the Shapella hard fork, $2,094 worth $2.1 billion was removed from Ethereum’s Beacon Chain, and Ether has surpassed $2,100 for the first time in 11 months. According to beaconcha.in statistics, the 1.03 million ETH withdrawals resulted from 473,700 withdrawal requests, with Saturday, April 15 being the highest withdrawal day with 392,800 ETH.

Nearly 87%, or 469,000 of the 540,000 active validators, can now withdraw their staked Ether. While the Ethereum community was divided on the influence Shapella might have on the price of Ether, the first four days saw a 10% increase. The figures come as no “surprise” to Lachlan Feeney, CEO of blockchain consulting and development firm Labrys, who told Cointelegraph that many validators are re-staking Ether back onto the Beacon Chain: “Much of the stake that has been withdrawn over the last few days is actually going straight back into The Beacon Chain as validators are looking to compound their interest.” So much so that the net stake is already growing.”

Given the present macroeconomic environment, Feeney noted that many early investors wanted to cash out after a roughly 30-month wait for some. Feeney feels that the Shapella hard fork will only increase the quantity of Ether staked in the medium to long term, which will improve Ethereum at the consensus level: “Because Shapella is a massive de-risking event, more, not less, ETH will be staked in the medium to long term.” We predict that in the not-too-distant future, we will set a new record for the amount of Ether staked.”

According to Markus Thielen, the head of research at digital asset platform Matrixport, the termination of crypto exchange Kraken’s staking services may have led to the higher figures:

“It appears to be due primarily to the Kraken’s staking business being unwound.” This will only be a transitory effect because we are also witnessing substantial demand from investors who can now bet with more insight on the liquidity of staked holdings.”

Thielen anticipates a considerable quantity of Kraken’s unstaked Ether will be “recycled” back into the Beacon Chain via other organizations. While Thielen expects the good price action to fade this week due to heightened selling pressure, he believes Shapella will eventually entice more institutional investors to participate in Ethereum.

The 1 million mark is a 500% increase over an April 11 projection by blockchain analytics startup Glassnode, which predicted just 170,000 Ether would be un-staked after Shapella’s first week. Nansen, an on-chain analytics startup, predicted 1.4 million Ether will be removed after Shapella’s first few days.