The Ethereum Shanghai upgrade, one of the most anticipated events in the blockchain space, has officially entered its fourth day — and the market response has been both surprising and bullish. Despite the release of nearly $150 million worth of ETH daily from staking contracts, Ethereum’s price has not only held steady but surged, outperforming Bitcoin by a wide margin.
This article dives into the latest post-upgrade data, analyzes staking trends, unpacks key player behavior, and explores why the market remains optimistic despite massive token unlocks.
Ethereum Post-Shanghai: Key Metrics and Market Reaction
Since the activation of the Shanghai-Capella upgrade on April 12, 2025, over 885,000 ETH have become eligible for withdrawal from staking contracts — equivalent to approximately $1.68 billion per day at current prices. Yet, contrary to bearish expectations, ETH has climbed nearly 10%, while Bitcoin managed only a modest 0.55% gain during the same period.
Here are the latest core metrics:
- Current staking APR: 4.99%
- Average daily unlock value: ~$168 million
- Total unlockable ETH: 885,000
- Total staked ETH: 17.29 million
- Staking ratio drop: Down 3.95% (now 14.98% of circulating supply)
- Net staked ETH reduction: -636,000 ETH (~$1.32 billion)
While over $3.18 billion in combined unlocked and withdrawn ETH has entered circulation potential, actual outflows remain significantly lower than maximum capacity. This suggests that most users are either withdrawing only staking rewards or choosing not to withdraw at all.
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Why Are Withdrawals Slower Than Expected?
One major factor behind the slower-than-expected withdrawal pace is Lido DAO, the largest liquid staking protocol, which has yet to enable full withdrawals for stETH holders. Lido controls roughly 30% of all staked ETH, meaning a significant portion of unlockable assets remains temporarily locked due to protocol-level delays.
This delay has created a natural buffer against market flooding. Many stakers appear to be waiting for Lido to go live with withdrawals before making decisions — a move that could trigger a new wave of activity in May 2025.
For users holding stETH, the expectation is that withdrawals will take between 1 to 5 days once enabled, minimizing friction and preserving capital efficiency.
Exchange-Level Unlock Patterns: Kraken Leads the Pack
According to on-chain analytics firm Nansen, withdrawal behavior varies significantly across exchanges and staking providers. Their data reveals:
- 4.5% of total staked ETH has initiated exit processes
- Approximately 26,319 validators (representing 571,075 ETH) have exited
- Kraken leads with 46.1% of all unlocks, followed by Binance at 22.3%
The dominance of Kraken in early withdrawals may reflect its long-standing support for non-custodial staking and user-friendly withdrawal interfaces. Institutional trust in Kraken’s infrastructure could also explain higher participation rates.
In contrast, Binance users appear more cautious — possibly due to integrated auto-compounding features or delayed interface rollouts.
GrayScale’s Bullish Take: Unlock ≠ Sell
Grayscale Investments released an in-depth analysis titled "A Pivotal Upgrade for Ethereum", reinforcing a positive outlook on the Shanghai upgrade. Their research highlights three critical insights:
- Lower-than-expected withdrawal demand – Only about 1.02 million ETH have been unlocked so far, but just a fraction has been moved off exchanges or into sell orders.
- Reduced staking risk boosts adoption – With withdrawals now possible, staking is no longer a “lock-up” gamble. This lowers entry barriers and could attract new institutional capital.
- Unlocks don’t equal selling pressure – Many users are reallocating funds rather than dumping them. Some are even reinvesting withdrawn ETH into higher-yield protocols or re-staking with more competitive providers.
GrayScale also noted that during the same period, 372,000 ETH were newly deposited into staking contracts, indicating strong ongoing confidence in Ethereum’s long-term value proposition.
Market Sentiment: ETH Outshines BTC Amid Macro Uncertainty
Despite broader macroeconomic headwinds — including tightening monetary policies and regulatory scrutiny — Ethereum has demonstrated resilience. The ETH/BTC price ratio has increased, signaling growing relative strength.
Several factors contribute to this trend:
- Increased developer activity on Layer 2 ecosystems
- Rising adoption of ERC-4337 (account abstraction)
- Strong DeFi and NFT rebound post-upgrade
- Improved network economics due to EIP-1559 burn mechanism
Investors appear to view Ethereum not just as digital money, but as a foundational platform for decentralized applications — a narrative that continues to gain traction.
👉 Learn how Ethereum’s upgrade cycle is reshaping the future of decentralized finance.
Frequently Asked Questions (FAQ)
Q: What was the purpose of the Ethereum Shanghai upgrade?
A: The Shanghai upgrade enabled withdrawals from the Ethereum proof-of-stake beacon chain. Before this, users who staked ETH couldn’t access their principal or rewards. Now, they can fully withdraw their staked assets, making staking a more flexible and attractive option.
Q: Does the drop in staked ETH mean people are losing faith in Ethereum?
A: Not necessarily. The 4% decrease in staking ratio reflects newly gained flexibility, not mass exodus. Many users are withdrawing only rewards or shifting funds between providers. Net outflows remain low compared to total stake size.
Q: Will Lido’s upcoming withdrawal support cause a price crash?
A: Unlikely. While Lido controls a large share of staked ETH, gradual processing limits and user behavior patterns suggest any outflow will be staggered over weeks or months. Moreover, many stETH holders may choose to re-stake or use their ETH in yield-generating protocols.
Q: How does the Shanghai upgrade affect Ethereum’s inflation rate?
A: Post-upgrade, Ethereum remains deflationary under normal usage conditions thanks to the EIP-1559 fee-burning mechanism. Even with increased token unlocks, transaction burns continue to offset issuance, supporting long-term supply contraction.
Q: Is now a good time to start staking ETH?
A: Yes — especially given the reduced risk profile after Shanghai. With withdrawal functionality live, stakers enjoy both yield (currently ~5%) and liquidity assurance. Just ensure you use reputable platforms and understand validator queue times.
Q: Why is ETH outperforming BTC after the upgrade?
A: Ethereum’s upgrade added tangible utility and flexibility, directly impacting investor sentiment and use cases. Bitcoin lacks a comparable near-term catalyst, making ETH more attractive in risk-on market environments.
Final Thoughts: A Maturing Ecosystem
The successful execution of the Shanghai upgrade marks a turning point for Ethereum — transitioning it from an experimental proof-of-stake chain to a fully functional, user-controlled network.
Although nearly $1.5 billion in ETH unlocks daily could have triggered panic, the market response shows growing maturity. Users are acting rationally, institutions are engaging strategically, and innovation continues to accelerate across DeFi, NFTs, and Web3 infrastructure.
Ethereum is no longer just surviving upgrades — it's thriving because of them.
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