Ethereum Devs Plan to Enable Staked ETH Withdrawals by March 2023

Ethereum’s core developers determined on a call Thursday that a network upgrade permitting users to withdraw staked ETH could launch as early as March of next year. 

In the months following Ethereum’s historic, successfully executed merge upgrade in September, the network’s developers weighed what updates to include in their next upgrade, Shanghai. Many improvements jockeyed for consideration, and different factions of developers lobbied to have their priorities included. But one upgrade in particular rose to the top of almost every list: staked ETH withdrawals. 

When the merge transitioned Ethereum to a proof-of-stake consensus mechanism, it changed how the network generates ETH. Ethereum holders can now deposit their existing ETH with the network, in order to generate new ETH. The more you deposit, the greater the yield. There’s only one hitch: you can’t get any of that ETH back yet.

With some $19 billion worth of ETH currently staked with the network, according to data aggregated on Dune Analytics, it was little surprise that Ethereum developers agreed today that enabling ETH withdrawals will indeed be a key feature to be included in Shanghai upgrade. 

The developers also expressed, however, that if any other update included in Shanghai slows its ability to be released by March, those improvements may have to be put on hold to ensure staked ETH withdrawal capability is rolled out as soon as possible. That determination will likely impact the potential for other anticipated Ethereum improvements to be included in the upgrade. 

One such feature—that Ethereum developers are still hopeful can be included in Shanghai, but may kick down the road if necessary—is EOF. 

EOF is essentially an update to the Ethereum Virtual Machine (EVM), the mechanism underlying Ethereum that deploys smart contracts on the network. There have been no updates to the EVM in over two years; despite being sorely needed, such maintenance was avoided in the era of the merge as it would have added immense complexity to the already highly intricate technical event. 

Delaying EOF any further would be a non-ideal scenario, and on Thursday, Ethereum developers made clear the update is a no-brainer second priority after ETH stake withdrawal. But the developers also acknowledged that if implementing EOF “significantly delayed” a March 2023 activation date for Shanghai, the update would have to, once again, be pushed. 

Another Ethereum improvement that many hoped would be included in Shanghai is proto-danksharding. According to Thursday’s call, however, that update will certainly have to wait. 

Proto-danksharding is a highly anticipated preliminary version of danksharding, a process by which huge amounts of data on Ethereum rollups—a tool used to combine many Ethereum transactions and treat them as one speedy, cheap transaction—will one day be verified by only sampling small pieces of data.

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Ethereum Launches Testnet to Begin Work on Shanghai Upgrade

Fresh off the success of a flawlessly-implemented merge event last month, Ethereum’s core developers are beginning to turn their attention to the network’s next, highly anticipated upgrade: Shanghai.  The Ethereum Foundation on Friday announced the launch of a pre-Shanghai testnet it's calling “Shandong.” Shandong will serve as a testing ground for numerous Ethereum Improvement Proposals (EIPs), which Ethereum’s core developers will build, tweak, and ultimately, whittle down to the select number...

Essentially, danksharding will take a process that already makes Ethereum transactions cheaper and faster, and make it far cheaper and faster. The update will dramatically increase the speed and ease with which huge amounts of data could be verified on Ethereum layer-2 networks like Optimism and Arbitrum. 

But alas, proto-danksharding, and potentially EOF, may have to wait for the next bus.