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Ethereum (ETH) Shanghai De-Risks Staking, Expect More ETH Locked, Top Analyst Chris Burniske Says

Sat, 03/18/2023 - 15:42
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Vladislav Sopov
Blockchain veteran Chris Burniske, co-founder of Placeholder and former head of crypto in ARK, shares his counterintuitive take on Shanghai upgrade
Ethereum (ETH) Shanghai De-Risks Staking, Expect More ETH Locked, Top Analyst Chris Burniske Says
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The majority of Ethereum (ETH) enthusiasts are scared about the effects Shanghai activation might have on its tokenomics. As it will enable Ether (ETH) withdrawal from staking contracts ("unstaking"), a significant amount of Ether might be released on markets. Here's why this is not totally correct.

No ETH price dump after Shanghai activation: Chris Burniske on risks and sentiment

In his recent tweet, Burniske highlighted one unobvious effect of Ethereum (ETH) Shanghai activation. According to him, the opportunity to "unstake" Ether (ETH) is a de-risking factor. As such, ETH staking is set to become more risk-free since Q2, 2023.

Therefore, more Ethereum (ETH) enthusiasts with various deposits will likely join its staking ecosystem. In a few quarters, the share of Ether supply locked in staking contracts might add 100-300%. So, the activation of Shanghai will result in volatility, but not in panic-selling.

Burniske also indicated that the Ethereum (ETH) staking process is still in its infancy: only 15% of Ether (ETH) is staked. To provide context, for "Ethereum killers" Cardano (ADA) and Solana (SOL), this indicator is about 70%. Ethereum (ETH) holders avoided staking their deposits since without an opportunity to withdraw funds, this lockup strategy was too risky for them.

Bitcoin (BTC) entrepreneur Matt Odell suggested that all available Ethereum (ETH) supply will migrate to the orange coin. Chris Burniske is not enthusiastic about this scenario:

The other 85% of unlocked $ETH can flee from Ethereum to Bitcoin as it pleases. Time to hang up the tired narrative, both $BTC and $ETH are quality assets

Ethereum (ETH) is trading at $1,822, up 4.4% in the last 24 hours. Yesterday, it reached the highest levels since August 2022.

Shapella upgrade inches closer to mainnet activation

First major upgrade of post-Merge Ethereum (ETH), Shapella (Shanghai + Capella) will be activated on mainnet on April 12, 2023, at about 10:27 p.m. UTC. This information was posted by Ethereum (ETH) core dev Tim Beiko.

Ethereum (ETH) Jumps 6% as Shanghai Mainnet Upgrade Date Is Announced

Ethereum (ETH) developers successfully activated Shapella in Goerli, the most popular Ethereum (ETH) testnet. It becomes the latest sandbox environment for Shapella stress-testing before mainnet deployment.

This upgrade signals the last phase of Ethereum (ETH) migration from proof of work to the proof-of-stake consensus.

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About the author

Blockchain Analyst & Writer with scientific background. 6+ years in IT-analytics, 3+ years in blockchain.

Worked in independent analysis as well as in start-ups (, Monoreto, Attic Lab etc.)