Ethereum Update

​​Crypto Market Week in Review (14 April 2023)

Markets

This week the markets were in a classic risk-on mode, reacting to the better-than-expected US macro data. The US employment data published during the holiday showed that the labor market remained strong, while the US CPI on Wednesday was slightly lower than it had been forecasted, further alleviating inflation fears. That led to mini-goldilocks in the stock market as the S&P 500 advanced to the highest close since February 15, fully recovering from the banking crisis. Long-term bonds were sold, reflecting lower demand for a safe haven.

The most important crypto news was the Ethereum upgrade called Shanghai or Shapella, enabling stakers to stand in a queue to withdraw coins pledged to help operate the network. Nansen estimated that just 4% of stakers requested a complete withdrawal, but waiting time could be as long as two weeks, according to the network explorer Rated cited by CoinDesk.

Ethereum fell to a year-to-date low vs. Bitcoin just before the update but rose sharply after Shanghai had gone smoothly.

Year-to-date performance of ETH/BTC

Ethereum advanced above the $2000 mark for the first time since August 2022.

The Shanghai update did not lead to a significant pickup in Ethereum implied volatility, as DVOL indexes were essentially flat for the week both for Ethereum and Bitcoin. Ethereum option open interest remained subdued after the big expiration at the end of March. The Ethereum volatility curve inverted prior to the update and flattened after it.

Ethereum 7-day, 30-day and 90-day at-the-money implied volatility

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