Ethereum Shanghai upgrade may reduce selling pressure on pledged ETH

03/02/2023 06:51 • Metaverse Matters • 156 views

On March 2, the online data platform CryptoQuant released a report saying that after the upgrade of Ethereum Shanghai, the pledge withdrawal of ETH may face lower selling pressure. This conclusion comes from the profit and loss analysis of the pledged ETH. The analysis is based on two reasons: 1. Most of the pledged ETHs (60% or 10.3 million) are currently in a loss state (compare the current ETH price with the price of each ETH pledge); 2. The depositors of the average largest pledge pool are also in a loss state. Generally, when market participants are sitting on huge profits, there will be selling pressure, but this is not the case with the pledged ETH.

Report: 60% of the pledged ETH is currently in loss

Interpret the above information:

The online data platform CryptoQuant recently released a report stating that the upgrade of Ethereum Shanghai may lead to lower selling pressure on the pledge withdrawal of ETH. The report is based on a profit and loss analysis of the pledged ETH and highlights two key reasons for the expected reduction in selling pressure.

The first reason is that a majority of the pledged ETHs, amounting to 60% or 10.3 million, are currently in a loss state when compared to the current ETH price with the price of each ETH pledge. This means that in case an individual were to withdraw their pledged ETH, they would have to sell it at a loss, resulting in lower selling pressure.

The second reason is that the depositors of the average largest pledge pool are also in a loss state. Since the largest pledge pool is usually comprised of whales, their participation in the market has a significant impact on prices. If they were to sell their pledged ETH, it could lead to a chain reaction of selling, which could result in a considerable drop in prices.

However, the report suggests that since the depositors of the largest pledge pool are also in a loss state, the likelihood of them selling their ETH is low, thereby reducing the selling pressure. The report concludes that if the upgrade is executed successfully, it could create a favorable environment for the stability and growth of ETH prices in the market.

In conclusion, the CryptoQuant report highlights the possible impact of the Ethereum Shanghai upgrade on the pledge withdrawal of ETH and the subsequent effect on selling pressure. The analysis shows that the reduction in selling pressure could lead to a more stable and conducive environment for growth in ETH prices. This report is significant for market participants who are keen on the price trends of ETH and those interested in understanding the dynamics of pledge withdrawals.

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Ethereum Shanghai upgrade may reduce selling pressure on pledged ETH

Report: 60% of the pledged ETH is currently in loss

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