Ethereum Shapella Upgrade Unlikely To Cause Major Sell-Off, Glassnode Data Reveals

The much-awaited Shapella upgrade for the Ethereum ETH/USD network has arrived, and analysts have weighed in on what it could mean for the world’s second-largest cryptocurrency. 

What Happened:  While some traders and analysts have expressed concerns about the potential impact of the phased release of staked Ethereum, on-chain analytics firm Glassnode said only a tiny fraction of staked Ethereum will be sold following the upgrade.

According to Glassnode, over 100,000 ETH of the total accumulated rewards is expected to be withdrawn and sold. Furthermore, the firm predicts that only 70,000 ETH will actually become liquid, representing less than 1% of the entire staked amount of 18 million ETH.

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“Even in the most extreme case, the impact on Ethereum prices will be ‘acceptable’,” the analytics firm said in its report.

Glassnode revealed that staking providers such as centralized exchanges or liquid staking platforms represent over two-thirds of all staked ETH, with Lido currently leading the way with 5.9 million ETH staked and a share of around a third.

While few staking providers will withdraw their validators, Glassnode’s data also shows that around half of all Ethereum staked is currently in profit. Furthermore, the realized price of all deposits is currently $2,136, while the Ethereum realized price stands at $1,403.

The Ethereum Shapella upgrade will offer two types of withdrawals for profit accumulation; a partial withdrawal that removes the validator’s staking rewards, reducing the balance to 32 ETH, or a full withdrawal which shuts down the validator, thus removing the entire staked balance.

Price Action: At the time of writing, ETH was trading at $1,872, down 2.32% in the last 24 hours, according to Benzinga Pro.

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