In the last seven months, Ether has breached $1,900 and is currently trading above $1,911. This happened exactly a week ahead of staking withdrawals enabled for the second-largest cryptocurrency by market capitalization.
According to the reports of CoinMarketCap, it was on August 16, 2022, when the Ether traded over $1,900 while the United States Federal Reserve hiked the federal funds rate to combat inflation.
Talking about the Ethereum Shanghai upgrade, the hard fork is set to occur on April 12 when Ethereum Improvement Proposal (EIP) will be implemented. As a result, it will allow validators and stakers to withdraw staked ETH from the Beacon chain. Furthermore, other EIPs aim to help increase transaction speed and reduce transaction costs too.
Shanghai is the fork on the execution layer client side and Capella is the upgrade name for the consensus layer on the client side which is expected to be executed only after the Shanghai update on April 12, 2023. The execution layer will be the one where all the smart contracts and protocol rules exist whereas the consensus layer ensures that all network validators follow the defined rules.
The experts believe that the recent price may be driven by an expectation the Federal Reserve may loosen its quantitative tightening efforts as increased rates caused cracks in the banking industry globally. However, Bitcoin has also recorded gains. The trading pair ETH/BTC has increased by almost 3% in the last week as reported by the trading view.
Some analysts and traders are also seen believing that unlocking staked Ether would create selling pressure on the market following the Shanghai and Capella updates.
