The Shanghai or Shapella upgrade, the second major upgrade on Ethereum after Merge, was successfully completed on April 12.
On April 12, ETHs that were locked with the Shanghai upgrade are unlocked and can be withdrawn.
Since the Shanghai upgrade, there has been an increase in ETH withdrawals as well as the number of newly staked ETH.
Analysts at Bitfinex, examining the increase in the number of ETH staked, said, "The interest in staked ETH has increased since the April 12 Shanghai upgrade." said.
According to the news of Coindesk, Bitfinex analysts wrote in their report:
“The increase in demand for ETH staking is likely due to large ETH holders who do not prefer to liquidate their holdings and instead seek to generate passive income.
The trend of staking ETH is expected to continue, especially given that deflationary forces are expected to increase the price of Ethereum significantly.”
Analysts also said that Glassnode data shows that more than 4.4 million coins have been deposited in the staking since April 12, with the number reaching 22.58 million.
More than 50,000 validators are currently waiting in line to join the network, according to Wenmerge data.
Again, according to the data, investors who want to become validators and earn passive income by locking their Ethereum to the network have to wait around 36 days to join the network.
The high demand stems from investors' belief in the rise in Ethereum and their desire to earn passive income from the ETHs they hold in the meantime.
Staking, as a passive investment and income generation method, started to gain traction after Ethereum's Beacon Chain became active in December 2020. For three years, from December 2020 to April 2023, investors could not withdraw their staked locked ETH at any time.
However, with the Shanghai upgrade in April, investors were able to withdraw their staked ETH at any time, increasing confidence in the network.
*Not investment advice