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Blockchain News

Ethereum [ETH]: Dipping Prices, Rising Negative Sentiments, and Everything in Between

According to statistics from Glassnode, there has been a sharp fall in the number of active validators on the proof-of-stake (POS) network since Ethereum’s [ETH] Shapella update went live on April 12.

On April 12, according to statistics collected from the on-chain data source, there were 562,941 active validators on the network. This dropped to 561,655 within 24 hours after the Shanghai update went online and stayed there ever since.

The overall number of validators voluntarily left Ethereum’s validator pool since Shapella increased noticeably by more than 400%, as measured by a 30-day moving average. 

A surge in withdrawals of previously deposited ETH tokens by certain validators on the network is the cause of the ongoing reduction in the active validator count on the Ethereum POS network.

Validators who had previously protected the network with more than 18 million ETH were permitted to start withdrawals after the Shapella update, which some of them did. 10,675 validators were planned for complete exit in the previous hour, according to a Nansen dashboard, at the time of publication.

Due to increasing withdrawals and sell-offs by people who had first staked their ETH coins in order to profit, many predicted that the value of ETH would decline dramatically after Shapella became online. The alt’s worth, however, briefly increased after the upgrade. 

Between April 12 and April 16, ETH’s price increased by 14%, according to statistics from CoinMarketCap. The most popular cryptocurrency traded over $2000 as of 16 April, when the price decline started. ETH was trading at $1,897.75 at the time of publication but has since dropped by 11%. 

Despite the price decline, ETH whales, who now possess between 100,000 and 10,000,000 ETH tokens, have increased their stockpile. Santiment records show that these large whales have grown by 2.5% since the Shapella.

On the other hand, whales that hold between 1,000 and 100,000 ETH coins have reduced their ETH holdings due to a risk-averse strategy. Santiment data showed that since Shapella, their number has decreased by 1%. 

In addition, although market sentiment briefly turned positive on April 14 as a result of the Shapella upgrade, it quickly returned to negative territory after the price drop, where it has stayed ever since. This was -1.172 as of publication. Any big increase in the price of ETH may be difficult to come by given the market’s pervasive negativity.

 

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