📈 Why Ethereum just hit an 11-month high 👀

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GM everyone. This is 2036, the crypto newsletter that pays you 💸

Last week, Ethereum underwent its latest major upgrade.

Analysts predicted it was a “buy the rumor, sell the news” event that would crash the price of ETH.

But last night, Ethereum hit a new 11-month high.

What’s happening? And is it too late to buy?

Let’s dig in.

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If you read 2036 last week, you know what happened. 

But for the newcomers, here’s the 7-second summary:

• In September 2022, Ethereum finalized its transition from being a blockchain secured by computers solving problems (proof-of-work) to one secured by users locking up their funds (proof-of-stake).

• In exchange for locking up their funds (for up to 2 years), users received a yield of 4-5% annually.

• Last week, the locked-up ETH and the rewards were finally made available for withdrawal for the first time.

As part of the upgrade, users can now withdraw their locked-up ETH at any time.

A lot of people believed most people would withdraw and sell their ETH and their rewards a.k.a this would be a negative event.

But as we pointed out last week, we think this event is hugely POSITIVE - and bullish - for ETH.

Going forward, large institutions who don’t want to lock up their funds for a long time can now stake and unstake ETH at any time.

They can buy one of the most trusted assets in crypto - Ethereum - and get a yield on it.

This is huge news for crypto (and finance in general) because ETH just became the first mainstream crypto-native bond.

So far, only 5% of stakers have withdrawn their deposits - and new deposits are coming in hot.

Now - there are queues and not all the ETH can be unstaked at once. But withdrawals are slowing down.

On top of that, 46% of the ETH waiting to be withdrawn is from Kraken, which is forced to unstake its ETH because it’s shutting down its staking service alltogether:

So on balance, the market seems to agree that this is good news 🎉.

In the last 5 days since the upgrade, ETH is up nearly 10%.

Of course, there’s no telling exactly where this will go.

More decentralized and centralized exchanges will enable withdrawals in the next couple of days and weeks.

But in the long-term, we believe this has massively de-risked Ethereum.

And if you’re wondering whether it’s too late to buy ETH, remember that contrary to bitcoin - which is an element, like digital gold - Ethereum is like the US economy in that:

• it’s the fastest-growing large economy with

• the biggest property market (NFTs)

• the biggest banks (DeFi)

• the largest market capitalization (ETH)

• companies (DAOs)

• roads and infrastructure (layer 2s)

and that in the last bull market, Ether went up 46X.

Ethereum is growing, de-risking, and in the words of Prince Vitalik himself - will be “done” this year.

So we don’t know about you, but we’re dancing like JT and Uma Thurman.

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