Moving ETH to a PoS consensus mechanism, and enabling Ethereum staking, was a long journey, especially considering how we perceive time in the cryptosphere. It started way back in late 2020 with the Beacon chain being deployed. This established the Ethereum network’s PoS chain. It created the new consensus layer. This culminated with an update known as The Merge. With it, the PoW mechanism was invalidated. The responsibility of issuance was then placed on the consensus layer. In short, this led us to present-day Ethereum. We moved away from ASICs to a more conservative, energy-efficient way to secure the network.
These changes were accompanied by all sorts of speculative talks. The change to PoS itself was mostly perceived in a positive way by the community. Reason for this is that it is part of a larger plan for the development of the network itself. These updates, beyond Ethereum staking, encompass network scalability through sharding. However, there was always the fear that these upgrades would impact price. This could be due to a failed activation or because, at some point, stakers would be able to withdraw funds.
By now, it’s safe to say that these concerns about Ethereum staking proved to be merely fear of the unknown. Recent updates to the network have not resulted in any considerable issues. Major infrastructures operating on it moved forward with the times, with people consistently staking more and more ETH.
Stats from: https://dune.com/hildobby/eth2-staking
The first major test of people’s trust in these consecutive upgrades was in April 2023, when the following one was deployed: Shapella. One of the highlights there was withdrawing staked liquidity, something impossible until then. Price remained fairly flat the following hours and less than a month later, we’ve had the biggest ‘bull run’ on liquidity deposits. This only cooled off later that year, somewhere around early November, as we can see through the chart above.
ETH’s price in USD has also been up since the Beacon chain was initially deployed, and despite the generally bear market of the past few months, it has also been up since Shapella was deployed. This is where staked liquidity withdrawals were enabled just before the middle of 2023.
All this evidence proves that the Ethereum ecosystem is here to stay, with people more and more confident in the technology and, consequently, in its price as the weeks go on.
If you are also confident about how things are looking and feel this is the time to prepare ahead of the bear market, we are available to help. Book a call with us here to find out how we can help you leverage this amazing moment in Ethereum history for the benefit of your project.