The Meaning of the Ethereum Shanghai Upgrade
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The Ethereum Shanghai Upgrade is nearing deployment. And this will give those who have staked tokens on the network the right to withdraw their token. As far back as 2020, all Ethereum has been barred, yet this has not deterred investors from putting roughly $33 billion into the network.
At the moment, the majority of those tokens have been staked via exchanges like Lido and Coinbase. Individuals who have tokens staked with the likes of the above-mentioned platforms will only have to wait. It was reported that Lido has barred the withdrawal of staked tokens until 30 days after the Ethereum Shanghai update. They said that it would afford them the time to carry out audits and security checks.
Meanwhile, Coinbase hasn’t said anything definite concerning the withdrawal of staked Ethereum tokens. Coinbase only mentioned that users will have to wait for months before they’ll be able to withdraw their staked tokens.
The Shanghai upgrade is a crucial development for the Ethereum network. This is because it is the completion of Ethereum’s transition from the proof of work to the proof of stake network. Nevertheless, this should not come with many changes to Ethereum’s user interface or the economics of the blockchain.
SEC’s Concerns About Ethereum
As most of the Ethereum staking was done through intermediaries, a huge quantity of the funds from staking contracts has been in circulation in the cryptocurrency for years. While a bit seems to have changed in the Ethereum network, the changes have only occurred in the political atmosphere concerning cryptocurrency. As the SEC becomes more aggressive in suing cryptocurrency organizations, concerns have been raised that Ethereum may get caught in their net.
Most importantly, on the same day that Ethereum moved to the proof-of-stake network, Gary Gensler mentioned that the proof-of-stake network can be regarded as a security offering because of the way it rewards stakeholders. By implication, this is referring to Ethereum.
People are already predicting that once stakeholder have been allowed to withdraw their token, SEC can capitalize on that as the fulfillment of a security consensus between stakeholder and the Ethereum team who have put the upgrade in place.
To Investors
It seems unbelievable that the Securities and Exchange Commission will try shutting down the huge Ethereum network. Nevertheless, this story is an interesting one, and it’s worth watching. One should take notice that SEC action will lead to many years of litigation before a resolution finally occurs.
