• The much-awaited Shanghai hardfork and the Shapella upgrade goes live on the Ethereum mainnet this April 12th.
• Here’s how individual stakers and those using the staking pools and services can withdraw their staked ETH. 

After successful testing of the Shapella upgrade on the final testnet Goerli, it is all set to go live on the Ethereum mainnet ahead of this month on April 12. The Ethereum Shanghai hardfork (popular as Shapella) is a major upgrade as it will allow users to withdraw their staked for the very first time.

The Shapella upgrade for the Ethereum blockchain basically combines the execution layer (Shanghai), consensus layer (Capella), and the Engine API. As we know, investors have been staking their ETH ever since the launch of the Beacon chain two years back.

With the Shanghai upgrade unlocking the withdrawal capabilities, many believe that it would lead to mass withdrawals of ETH thereby creating selling pressure on the crypto. The world’s second-largest cryptocurrency Ethereum (ETH) has witnessed a strong rally along with Bitcoin this year. ETH is already trading at more than $1,800 currently with more than 50% gains year-to-date.

However, whether or not a user will be able to withdraw the staked ETH depends on the method chosen for staking. For validators to participate in the block validation process, they need to stake a minimum of 32 ETH in the Beacon chain. This is more than $58,000 as of the current ETH price making it difficult for retail players to become validators.

To reduce this barrier to entry, several staking services and decentralized staking pools have emerged in the market. Thus, users can stake any minimum amount with these services. These staking pools would then pool together other stakers’ ETH and later lock it into the chain.

Getting Access to Staked ETH

Solo stakers, who haven’t used any services or staking pools, can access staked ETH withdrawals in two ways: either through partial withdrawals or full withdrawals.

Partial withdrawals involve withdrawing the rewards earned through the staking of 32 ETH. These rewards will be available for withdrawal immediately. For those running their own validator, they should first migrate to include a 0x01 withdrawal credential. If the user doesn’t install these withdrawal credentials, partial withdrawals won’t happen automatically.

Full withdrawals, on the other hand, mean users can withdraw their entire balance, including the 32 ETH staked with the blockchain. This would mean that the validator will stop participating in the blockchain validation process.

Now, coming to those who have staked their ETH using a staking service of a decentralized staking pool. They will first need to check with their service providers regarding the timeline for staked ETH withdrawals. Earlier this month, crypto exchange Coinbase, which offers staking services to its users, said that it would process the withdrawal requests 24 hours after the Shapella upgrade goes live. Coinbase said in a tweet.

All unstaking requests are processed on-chain, and we’ll pass the unstaked funds and staking rewards to you once released by the Ethereum protocol.

Similarly, the third-largest liquid staking protocol Lido said that its users who hold stETH won’t be able to retrieve their ETH until the protocol undergoes an upgrade in mid-May. Lido said that they first need to go through proper security checks.