JPMorgan (JPM) mentioned in a research report on Wednesday that an altcoin upgrade to be implemented next month could have an impact on the price.
JPMorgan analysts say the upcoming upgrade will have an impact on this altcoin
The banking giant said in a recent research report that the Shanghai upgrade of Ethereum (ETH), scheduled for mid-March, will increase the network’s staking rate in the medium term. The bank says there is plenty of room for it to rise another 14%, given that Ethereum staking volume is about four times higher than other PoS networks.
Analysts led by Nikolaos Panigirtzoglou said, “Assuming that the stake rate approaches 60% on average for other major PoS networks over time, the number of validators could go from 0.5 million to 2.2 million and the throughput could drop to around 5% from the current 7.4%” he wrote. In the Proof of staking system, validators confirm that a block is correct and can be added to the Blockchain. As Kriptokoin.com, we have included what you need to know about the Shanghai upgrade in this article.
JPMorgan analysts say liquid staking protocols like Lido play an important role
These protocols “provide an equal amount of derivative tokens in exchange for tradable staked Ethereum, providing liquidity for staked assets that would otherwise be locked in staking contracts.” JPMorgan notes that liquid staking protocol derivative tokens normally trade at prices below their underlying assets, but are approaching parity with Ethereum (ETH) as the Shanghai upgrade approaches.
The report states that the use of these liquid staking protocols will decrease as the upgrade date approaches. The counter-argument is that the utility of these protocols is not only limited to providing liquidity, but also acting as an intermediary for individual investors who would otherwise face 32 ETH ($52,000) hurdles for staking. As a result, liquid staking protocols have become major decentralized finance (DeFi) players, raising concerns about network centralization.
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