The price of Ether (ETH) has taken a significant hit in the past few days, dropping by over 13% after tapping a ten-month high of $2,137 earlier this month. Over the past 24 hours, ETH has fallen by 1.4% and was trading at $1,826 at press time, as per CoinMarketCap data.
Ether’s recent price action can largely be attributed to the Shanghai or Shapella upgrade, which was implemented on April 12. The event enabled withdrawals of approximately $34 billion worth of tokens locked on Ethereum’s staking contracts, marking the network’s complete transition to a fully functional proof-of-stake network.
Ether Withdrawals Soar
Almost two weeks after Shanghai, Ethereum’s metrics have continued to shine, with 1,668,384 ETH worth just over $3 billion being withdrawn so far, as per data by Dune Analytics. Notably, around 65% of the total ETH withdrawn so far comes from partial withdrawals, while the rest is from full withdrawals.
According to Tom Wan, an analyst at crypto research firm 21 Shares, most Ether withdrawals seem to be coming from centralized exchanges such as Kraken and Coinbase.
According to the pundit, Monday-April 24, had the most full withdrawals, with (278.2k) ETH flowing into Kraken, Coinbase, and Cream. At just over 870,000 ETH, Kraken and Coinbase account for the majority (78.3%) of the principal withdrawals.
However, Kraken’s leading withdrawal count can be attributed to regulatory scrutiny, which has forced it to shut down its staking services for US citizens. Since Shanghai, Kraken has received 598k $ETH ($1.1B) in both partial and full withdrawals.
Institutions Throng to ISPs
Meanwhile, as CEXs continue taking out their Ether, the number of coins sent to staking pools has surged gradually. In addition to the Merge, which saw Ethereum shift from proof-of-work (PoW) to proof-of-stake (PoS) in September 2022, the Shanghai upgrade has further sparked the interest of institutional investors in the second largest cryptocurrency.
According to Wan, Institutional Staking Providers (ISPs) have witnessed significant inflows of ETH staked “as Shanghai has reduced the liquidity risk for investors.”
On Sunday, the analyst highlighted a chart showing the five leading staking service providers for institutional investors – Bitcoin Suisse, Figment, Kiln, Staked.us, and Stakefish – have collectively staked 224,000 ETH (About $410 million) in the last 30 days.
Furthermore, institutional investors seem also to be eyeing Ether’s attractive staking rewards even as they continue to bet on higher prices.