Ethereum Merge Just the Start; Shanghai Upgrade & More in 2023
The long-awaited Ethereum Merge was the network’s crowning achievement in 2022, but there are still proposals and upgrades to contend with in 2023.
The Ethereum Foundation and research team have been addressing emergent issues and progress in the maximal extractable value (MEV) domain, according to a compilation by Ethereum.
The transition of the Ethereum mainnet to proof-of-stake (PoS) was the year’s highlight. But there’s still plenty that the team hopes to achieve in the coming year.
Ethereum made the PoS transition in September, reducing its energy requirements roughly by 99%.
EIPs Scheduled for 2023
Vitalik Buterin’s multi-dimensional EIP-1559 proposal is queued for implementation in 2023. As a follow-up to the London Hardfork, the plan addresses gas reforms to combat exorbitant transaction fees. Stakers could also see a staking withdrawal feature introduced via Capella, a consensus-layer upgrade. The upgrade will allow Beacon Chain withdrawals to execution layer accounts. Ethereum acknowledged that the capability is now undergoing testing.
Beaconcha.in reports that 15.7 million ETH are presently staked, roughly 13% of the total supply.
As an extension of Capella Upgrade, Ethereum also stated that it be working on EIP-4844 or Proto-Danksharding to scale the network in the upcoming year. For this, the network is collecting public contributions up until Jan. 31, 2023. The network upgrade is expected in three weeks after the final contribution.
Thus, the significant Shanghai Upgrade, scheduled for March 2023, qualifies as a substantial upgrade package composed of five EIPs.
As per the Ethereum Foundation,
“Withdrawals will finally complete The Merge, enabling staked ether and accumulated rewards to be collected, while the EOF work will enable a cleaner internal organization of smart contracts, simplifying compiler work and also enabling a few more advanced features to be implemented.”
Henrique Centieiro, Senior Research Manager at HashKey Capital, believes, “With the successful launch of the Merge, the staked ETH withdrawal capability is clearly becoming the top of the core developer’s focus and priority for the upcoming Shanghai Upgrade.”
The network aims to reach a significant milestone for scalability while enhancing security and its Solidity language. Ethereum released six Solidity revisions in 2022, and a developer survey is underway for January 2023.
ETH Price Remains Sluggish Despite Busy New Year
Despite several improvement packages keeping Ethereum’s schedule busy, its price isn’t exactly reflecting the enthusiasm. At the time of press, ETH is hovering slightly under the $1,200 price point, marking a 69% loss since the beginning of 2022.
This also happens while Ethereum has completed one-quarter of its much-anticipated Merge. According to BeInCrypto analysis, ETH prices could continue to suffer in the near term.
Coinglass estimated that there was $7.69 million liquidated across all exchanges today. Technical signals also imply that the current levels of support might be lost. However, if the altcoin market booms in the new year, some analysts also expect that ETH will continue outperforming Bitcoin as market mayhem settles.
Ethereum, however, continues to rule the DeFi sector. With more than 620 decentralized finance protocols, ETH has the biggest total value locked (TVL) of any chain at $22.88 billion.
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