Two major events this week have set new expectations in the otherwise lacklustre cryptocurrency industry hit hard by scams and hacking. The Ethereum chain had moved earlier to the eco-friendly PoS system for validating transactions, but the validators cold not withdraw their staked Ether. The recent Shanghai upgrade now allows them to do so. In another unrelated development, Bitcoin finally went above the $30K mark in the hopes of positive inflation data to come soon.
The Shanghai upgrade will let stakers withdraw their Ether, and that means a negative selling pressure could be seen as over $33 billion worth of Ether becomes liquid. It is anyone’s guess how the Ether price may behave, but for now it has risen to near $2K, in tandem with Bitcoin’s price movement. As per data from Dune Analytics, 15% of total available Ether is locked for staking. Slightly over a million Ether coins are now available from the staking pool.
The year-to-date period of 2023 has seen positive returns (Bitcoin over 80% and Ether over 60%). Some traders consider it difficult to predict how the Shanghai upgrade will affect Ether prices.
The PoS system works like a raffle or lottery, with no competition to be the first or hard computing required. The amount of staked ether determines to some extent where the rewards will go.
Bitcoin has come under attack for its intense and huge consumption of electric power, equalling that of entire countries. In 2022, data from Cambridge University reveals miners consumed 107 terawatt-hours of energy. Some percentage of this, a quarter or over that, comes from renewable sources like hydro.
Ethereum too used huge power supplies, about two thirds that of Bitcoin, before it switched to the green PoS system. However, this has failed to have any great impact on its price or popularity. Ethereum is famous for its smart contract feature, which allows codes and rules to be executed to offer services like financial products, create NFTs and for many other different applications.
Bitcoin is considered by its followers to be the only real, decentralized and open-source cryptocurrency not managed, controlled or overseen by any organization or team. It’s a cryptocurrency without a CEO, and a currency without a central bank.
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