The Ethereum (ETH) network is stabilizing with respect to its staking activity post-Shapella upgrade. According to an insight from crypto researcher Tom Dunleavy, new deposits to the Ethereum staking smart contracts have exceeded the total withdrawals in the queue at this time.
New deposits to the Eth staking have flipped withdrawals for the first time since Shapella w/ an entering validator queue of ~14k validators, versus an exit queue of ~12k— Tom Dunleavy (@dunleavy89) April 27, 2023
A sign of strength for the Eth network in the face of large forced withdrawals from Kraken.
h/t @DPCio pic.twitter.com/syG6BRBDkj
This implies the Ethereum protocol is bound to witness some forms of stability in terms of its circulating supply with more of an upside potential. According to the analyst, the increasing staking deposit shows that the Ethereum protocol is healthy, after thousands of the digital currency were withdrawn forcefully from Kraken exchange.
Ethereum transitioned to a new era following the launch of the Shapella upgrade earlier this month. With early backers of the Ethereum staking system notably keen on withdrawing their assets and selling them after about two years of locking them up, there was a high imbalance in the selling and redepositing of Ethereum tokens over the past few weeks.
This rebalancing is crucial, and it is billed to have a very defined and positive undertone for the price moving forward. With growing deposits, the supply of ETH will be crushed significantly and with a sustained or growing demand, prices are bound to be pushed upward.
Projections for price
Ethereum has had a very positive growth outlook for the better part of this month as anticipation for the Shapella upgrade excited the digital currency's bulls. While the bullish momentum faded with the sell-off of unlocked tokens, the asset has formed a strong support around the $1,700 price range.
By leaning on these numerous fundamentals, this support level can serve as a significant springboard for more imminent price jumps. The cryptocurrency is changing hands at $1,893.28 with a 3.83% loss; however, there is a high likelihood that the coin will breach its 90-day high of $2,137.45 in the short term and may even retest $2,500 if the staking momentum persists.