Ethereum core developers say they are chugging steadily towards their goal of launching Shanghai and enabling staked ETH withdrawals on the network by March.
This week, the group launched “devnet 2,” a developer network designed specifically to allow client teams to tweak the ETH withdrawal process and make sure they get it right. The network launch went mostly smoothly, with minor but expected hiccups, according to a developer call Thursday.
ETH withdrawal capability will launch as the central component of Ethereum’s much-anticipated Shanghai upgrade. A previous upgrade, known as the “merge,” officially transitioned Ethereum to a proof-of-stake system, which involves network participants known as validators pledging ETH to the network in order to verify transactions and keep the network secure. These validators also earn newly minted ETH as a reward for staking.
Even before the merge, network users were given the opportunity to start staking on Ethereum in anticipation of the upgrade. A total of $22.7 billion worth of ETH now sits in the staking contract. But these users have yet to be able to unstake those funds, meaning they still can’t retrieve the ETH they have pledged.
Ethereum’s Shanghai upgrade is expected to roll out that capability—assuming it all goes according to plan. Given that more than 16 million ETH is currently staked with the network, introducing the ability to withdraw those funds is understandably a priority for the Ethereum community, and the network’s developers.
The Shanghai upgrade, for example, was initially intended to include a number of other eagerly awaited updates, including proto-danksharding, a streamlined data-sampling process that would make layer-2 transactions on Ethereum substantially cheaper and faster. Proto-danksharding was eventually scrapped from Shanghai, to make sure ETH withdrawal capability was rolled out as quickly as possible. The feature is expected to instead roll out later this year.
Last week, developers also made the tough decision to further delay EOF—updates to the Ethereum Virtual Machine (EVM), the mechanism underlying Ethereum that deploys smart contracts. There have been no updates to the EVM in over two years, since such maintenance was delayed in the era of the merge to avoid further complicating an already intricate procedure. It is now being kicked down the road again to prioritize ETH withdrawals.
Those delays, however, may make a March delivery date for Shanghai more likely.
“Things are looking great,” Ethereum core developer Marius Van Der Wijden told Decrypt. Though Van Der Wijden wouldn’t make predictions as to the exact date of Shanghai’s release, the developer said he’s seen no indication the upgrade will be stalled.
“I’m not aware of any issues that could delay Shanghai at this moment,” he said.
On Thursday, Ethereum developers also successfully deployed the network’s first ETH withdrawal shadow fork—a dress rehearsal for the coming update. That shadow fork, though, only tested a handful of clients; a mainnet shadow fork (a full dress rehearsal of the update) is expected to launch in the coming weeks.
Developers also plan to launch a public Shanghai testnet by early February, which will allow stakers and staking firms to play around with and stress test the software before launch.
“The outreach phase will start once we have a testnet that stakers can join to test their workflows,” Van Der Wijden said. “At that point, the software should be production ready.”
In anticipation of the successful implementation of ETH withdrawal capability, tokens powering staking protocols have jumped substantially. Lido Finance (LDO) is up 34% in the last week, now trading at $2.03, according to CoinGecko. Rocket Pool is up 24% in the same period, trading for $27.75.