Ethereum Outperforms Bitcoin After Shanghai Upgrade

Ethereum’s price uptrend continues as of April 18, just four days after the activation of the long-awaited Shanghai Upgrade for the smart contracting platform. As Ethereum bulls double down, the cryptocurrency has outperformed Bitcoin, the largest cryptocurrency in terms of market capitalization. In fact, ETH has risen by approximately 15% in the past week of trading when compared to Bitcoin.

Ethereum Outperforming Bitcoin

ETH is trading at 0.0708BTC, reaching a new April 2023 high. This has resulted in a bullish breakout formation versus Bitcoin. The most notable development in the past few days is the solid break above recent resistance, now support, at around 0.0677BTC on April 14. However, despite the impressive recovery of prices, ETH bulls have yet to reverse losses posted against Bitcoin from early March completely. Bitcoin added approximately 20% against Ethereum, with noticeable gains visible in mid-March 2023.

The US Banking Crisis

In mid-March 2023, fears of a banking crisis in the United States arose when three banks collapsed quickly, sparking a bank run of the Silicon Valley Bank (SVB), a regional bank. The de-pegging of USDC, a stablecoin, also saw users move their assets to, among other coins, Bitcoin. Furthermore, news that Binance will also purchase BNB, Ethereum, and Bitcoin provided much-needed momentum for Bitcoin.

The Shanghai Upgrade and Ethereum’s Rapid Expansion

However, after weeks of underperforming Bitcoin, the tide is beginning to shift in favor of Ethereum. Although the recovery can be traced back to April 10, the rapid expansion of ETH prices versus Bitcoin is marked on April 14. On this day, the Shanghai Upgrade went live, allowing validators and stakers to withdraw their coins from the Beacon Chain, boosting ETH liquidity.

Before the upgrade, on-chain data revealed over $32 billion worth of ETH was locked up in the official deposit address. Interestingly, while some validators and stakers have since withdrawn their coins, the dollar value of assets tied in the Beacon Chain exceeds $39 billion. The expansion could be partly due to the appreciation of ETH prices over the past few trading days, pushing the coin above the $2,000 level.

The Capella Update and Ethereum’s PoS Platform

Shanghai has completely turned Ethereum into a proof-of-stake (PoS) platform, with coin holders able to withdraw their assets. Besides Shanghai, the simultaneous update through Capella introduced consensus changes, making the mainnet more secure, performant, and efficient.

Will Bulls Sustain The Uptrend After Shanghai?

It remains to be seen whether ETH will continue outperforming Bitcoin in the days ahead. However, it is vital for ETH bulls to firmly push above 0.072BTC, or February and March 2023 highs, in a breakout. This could be the base of another leg up towards Q1 2023 highs of 0.078 BTC.

Conclusion

Ethereum has been performing well in the last week of trading and has outperformed Bitcoin, the world’s largest cryptocurrency by market cap. The recent activation of the Shanghai Upgrade has further fueled the bullish trend in the coin’s price, and the expansion of ETH prices versus Bitcoin is marked on April 14. However, it remains to be seen whether this trend will continue in the days ahead, and ETH bulls need to firmly push above 0.072BTC to sustain the uptrend. With the simultaneous update through Capella, Ethereum has become a more secure, performant, and efficient proof-of-stake platform. As the crypto market continues to evolve, it will be interesting to see how Ethereum’s performance stacks up against other cryptocurrencies.

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