- Ethereum’s Shanghai update went live Wednesday, completing the blockchain’s transition to proof-of-stake.
- ETH is up 2.28% in the last 24 hours, so far defying predictions of a price drop.
- Ethereum co-founder Vitalik Buterin hailed the upgrade as the end of “the hardest and fastest” stages of the blockchain’s roadmap.
Ethereum, the blockchain underpinning the second-biggest cryptocurrency ETH, successfully implemented its much anticipated ‘Shanghai’ upgrade on Wednesday. The update, also known as ‘Shapella’, enabled validators to withdraw staked ETH for the first time, and brought Ethereum significantly closer to the completion of its multi-year transition to a full proof-of-stake network.
In a proof-of-stake system, users pledge coins as a form of guarantee to help validate new data on the blockchain in return for rewards, a process called staking. Prior to Wednesday’s update, it was not possible to withdraw staked ETH or redeem accrued rewards.
Staked ETH currently accounts for about 15% of the total supply of Ether tokens, according to crypto data platform Dune Analytics, and are worth approximately $31 billion. ETH is up 2.28% in the last 24 hours, so far defying expectations of a post-upgrade ‘wave of selling’ that would depress its price.
Speaking at a launch event streamed live on the Ethereum YouTube channel, Vitalik Buterin, the co-founder of the Ethereum blockchain commented, “We’re in a stage where the hardest and fastest parts of the Ethereum protocol’s transition are basically over. Very significant things still need to be done, but those very significant things can be safely done at a slower pace.”
Of what lies ahead on Ethereum’s roadmap, Buterin said scalability — improving the cost and energy efficiency of transactions — was the new priority. “If we don’t fix scaling before the next bull run, we know people are going to be stuck paying $500 transactions. If, on the other hand, we don’t have Verkle Trees before the next bull run, well, things might suck, but you know, it’s a much smaller problem than, you know, $500 transactions, right?” he added.