Ethereum's Shanghai upgrade went live on Thursday, allowing those who have staked their ether to begin the unstaking process. Kraken leads the exit queue breakdown with 62%, according to on-chain data tracked by Rated network explorer. The number of validators in the exit queue has surpassed the 15,000 mark at press time, per Parsec Finance. Kraken's dominance in the unstaking queue is largely expected due to the legal issues it faced with the Securities and Exchange Commission, resulting in a $30 million settlement. The Shanghai upgrade appears to have had a marginal effect on the Ethereum protocol and its token, with only a -0.25% change in staked ether, according to Nansen.ai data. Nansen's data shows that 4.35 million ether, or about 24%, is staked at above $3,000.

The completion of the Shanghai upgrade on the Ethereum network may prompt some centralized entities to exit. Validators who secured the network with over 18 million ETH can now initiate withdrawals, with options for partial withdrawals to leave at least 32 ETH deposited or full withdrawals to pull everything off the network.

According to Beaconcha.in data, 18083.69 ETH withdrawals were processed on April 12 after the Shapella upgrade, with the first 5,413 ETH withdrawals in the epoch 194048.

In recent months, Ethereum has experienced a significant surge in price, surpassing multiple resistance levels. However, the bullish momentum appears to be fading, and the cryptocurrency is currently having difficulty in continuing its upward trend. As of now, ETH is struggling to maintain its position and surpass a significant resistance region.

The Ethereum blockchain's Shanghai upgrade, or Shapella, is expected to unlock $30bn worth of ether locked in the network since the end of 2020. Some analysts expect an ether price decline after the upgrade as users liquidate their holdings, while others believe the expected uptick in selling pressure is already factored in and the market will bounce after the event. Henry Elder, head of decentralized finance at Wave Digital Assets, sees the upgrade as a "sell the news" event, while Sean Farrell, head of digital asset strategy at FundStrat, expects an ether-bitcoin rally following the completion of the event.

Ethereum's Shanghai upgrade, also known as Shapella, will enable the first-ever withdrawals of staked ether (ETH) and complete the network's transition to a fully functional proof-of-stake network. The upgrade is expected to take place at around 6:30 p.m. ET (22:30 UTC). Ethereum developers say they're feeling confident the upgrade will go smoothly, and the Ethereum Foundation doubled its "bug bounty" program awards to $500,000 ahead of Shanghai to encourage individuals to report any vulnerabilities they could find. Crypto market analysts have weighed in on how ether might trade as Shanghai goes live, with some suggesting it will have limited if any impact on the market for ether.

On-chain report from Glassnode estimates at least $300 million worth of selling pressure for ETH after the much-awaited Shanghai upgrade. Glassnode estimated a total of 170K ETH intended to be sold after the upgrade, but even in the most extreme case where the maximum amount of rewards and stake are withdrawn and sold, the sell-side volume still falls within the range of the average weekly exchange inflow volume. Staked ether cannot be withdrawn or freely traded currently, but Shappella, which is expected to occur simultaneously with Capella on April 12, will allow investors to withdraw their ether staked on the Ethereum blockchain. Banks such as JPMorgan say that ether will likely face some selling pressure from the upgrade.

The highly anticipated Shanghai/Capella hard fork is scheduled to take place on 12-April-2023, which enables withdrawals of staked ETH. In this piece, we establish cohorts of stakers, and assess the potential sell-side pressure which may occur due to the unlock event.

Bank of America has warned that the limited throughput of Ethereum and increasing competition from alternative blockchains will constrain its adoption and usage, despite its first-mover advantage in introducing the idea of blockchain operating systems compatible with smart contracts and decentralized applications. The Shanghai upgrade, due to occur later today, will enable validators to withdraw staked ether and rewards that have been locked up. However, the upgrade does not address scalability and acts only as a precursor for future upgrades. Bank of America's report suggests that Ethereum's long-term viability will depend on the execution of its development roadmap, which includes the implementation of a sharding approach called Danksharding, but this is still years away. The bank expects heightened volatility around the upgrade due to decreased liquidity, derivatives activity, and because of the ether price action seen around the previous upgrade, the Merge.

Hong Kong's ZA Bank, the largest virtual bank by assets, is set to offer crypto account services and facilitate crypto-to-fiat exchanges.