Ethereum(ETH) staking deposits dip due to regulatory pressure and Shapella upgrade

Staking deposits for Ethereum(ETH) have declined slightly in recent weeks due to increased regulatory pressure and the Shapella upgrade scheduled for April 12.

The Ethereum staking ecosystem was examined by on-chain analytics provider Glassnode on April 9. According to the data, deposit activities are currently low “as a result of regulatory pressures and the Shanghai upgrade.” Financial regulators in the United States(US) have been coming down hard on cryptocurrency this year. Although Congress has not officially classified Ether (ETH) as a security, the Securities and Exchange Commission (SEC) insists that cryptocurrency is a security and has cracked down on staking.

The Ethereum(ETH )network will undergo a long-awaited upgrade on April 12. ETH staked on the Beacon Chain will be released phase-by-phase as a result of the Shapella hard fork, also known as the Shanghai hard fork.

These two factors have caused the dip in ETH staking deposits, according to Glassnode. According to the report, Lido emerged victorious among the three giants, continuing to dominate deposit inflows even today.

Lido currently accounts for nearly a third of all Ethereum staked. This equates to approximately $11 billion from the platform’s 5.9 million Ethereum (ETH). Through its staking token, Lido Staked ETH (stETH), Lido offers the chance to earn extra yields on DeFi platforms. This explains the gradual shift to savvy investors shifted to more profitable platforms. Analysts predict that when ETH is released from the Beacon Chain following the Shapella upgrade, liquid staking platforms such as Lido will benefit. 

According to Ultrasound, an Ethereum metrics tracking platform. There are currently 18.1 million ETH staked in total, worth around $33.7 billion and accounting for 15% of the total supply. Following the Shapella upgrade, this will be gradually released for withdrawal in the weeks and months to come. 

Buy and sell crypto in minutes with 0.20% trading fees at Bitdenex Exchange.