- The upcoming Ethereum Shanghai upgrade is eagerly anticipated by both whales and retail investors.
- Ethereum’s selling pressure may be attributed to a recent Bank of America report predicting a decrease in ETH usage.
Ethereum (ETH), the world’s second-largest cryptocurrency, recently witnessed a surge to the $1,800 mark but struggled to maintain this momentum. Over the weekend, the altcoin experienced selling pressure, causing a 1.88% decline to $1,756 at press time, with a market cap of $214 billion. As the Ethereum network prepares for the upcoming Shanghai upgrade in April, its price appears to have entered a consolidation phase.
On the technical chart, the $1,680 level represents the apex of a symmetrical triangle dating back to September 2021. Since ETH’s price has already surpassed this mark, it is now a crucial support level. Bulls must defend the $1,680 level to prevent further price declines.
Ethereum’s selling pressure may be attributed to a recent Bank of America report predicting a decrease in ETH usage if the network’s speed does not improve soon. The Ethereum blockchain underwent the Merge upgrade in mid-September 2022 to enhance scalability and performance. However, a Bank of America analyst claims that the network’s speed remains relatively unchanged, necessitating an upgrade to maintain its position among the top two cryptocurrencies by market cap.
Ethereum Whales and Retail Players Stock Up Ahead of Shanghai Upgrade
Despite selling pressure, on-chain data reveals that Ethereum whales have been actively accumulating large quantities of ETH as the Shanghai upgrade approaches. This upgrade is significant as it will enable the release of staked ETH, allowing users to withdraw their coins from staking at their discretion.
Data from Santiment shows that Ethereum wallet addresses holding between 1,000 and more than 10,000 ETH, as well as those holding between 1 million to 10 million ETH tokens, have been consistently adding to their ETH holdings over the past week. This trend indicates that large wallet addresses are predominantly bullish on the world’s second-largest cryptocurrency by market cap.
Retail investors have also been accumulating ETH consistently. According to Glassnode, the total number of Ethereum addresses with at least 0.01 ETH has reached 23.3 million, with the address count hitting an eight-month high. Concurrently, the total value locked (TVL) in the ETH 2.0 deposit contract has reached a new all-time high of over 17 million ETH, suggesting a bullish outlook for the cryptocurrency.
Despite Ethereum’s significant advancements this year, it has faced challenges in keeping pace with Bitcoin’s gains. The Shanghai upgrade could potentially serve as a catalyst to boost ETH’s market performance and increase buying pressure. However, it remains to be seen whether this upgrade will address the network’s speed issues and help Ethereum solidify its position among leading cryptocurrencies.