Ethereum (ETH) reached a value of $1,900 for the first time in over seven months, a week before the introduction of withdrawal options for staked tokens as part of the next major update for the second-largest cryptocurrency by market capitalization.
The previous, seven-month peak for ETH occurred on August 16, 2022, when a broader sell-off in the crypto market took place as the United States Federal Reserve raised the federal funds rate to combat inflation.
The upcoming Ethereum hard fork, named Shanghai, scheduled for April 12, will introduce Ethereum Improvement Proposal (EIP) 4895, enabling the withdrawal of staked ETH from the Beacon Chain, as well as other proposals aimed at increasing transaction speed and lowering costs.
Shanghai refers to the forks at the client execution layer, while Capella refers to the update at the client consensus layer, set to be carried out right after Shanghai on April 12. The execution layer contains all smart contracts and protocol rules, while the consensus layer ensures these rules are followed by all network validators.
It is worth noting that after the Merge on September 15, 2022, the price of ETH dropped nearly 25% within one week.
Although some analysts and traders suggest that the unlocking of staked Ether may cause selling pressure, what will happen after the Shanghai and Capella updates remains unknown.
Changes introduced in the Ethereum network may affect the value and functioning of cryptocurrencies, so it is worth keeping an eye on the developments and price changes in the crypto market.
