aoc | Crypto Trader

The Ethereum Shanghai Upgrade pt.1

What is the $ETH Shanghai upgrade?

Everyone on CT is talking about the millions of $ETH about to be unlocked, but what else does this upgrade mean?

A thread 🧵


1/ The $ETH Shanghai upgrade is the most significant event happening to the protocol since The Merge.  

It's a hard fork scheduled to happen in April this year 


2/ But what is a hard fork? 

A hard fork is a software update that is not compatible with the existing blockchain protocol. As a result of this, the blockchain network has to be split into two different networks


3/ What are the new changes introduced in this upgrade? 

The Ethereum Improvement Proposal (EIP) 4895 is one of the most awaited upgrades, allowing validators to withdraw $ETH staked as far back as the Beacon's chain launch, in December 2020 


4/ The Ethereum Shanghai upgrade will also feature some other EIPs designed to reduce gas costs for Ethereum developers, and improve efficiency, security and scalability, such as EIP-3651, EIP-3855, EIP-3860, and EIP-6049


5/ These upgrades will help developers, making it cheaper and easier to build dApps on the Ethereum blockchain. 

So, will these changes affect the price?


6/ While it is difficult to forecast the exact outcome of the upgrade in the price yet; the market will certainly be quite volatile due to the close attention this event is receiving


7/ With 17.6M $ETH getting unlocked, many expect downward pressure on the price due to all the liquidity flooding back into the open market

Others argue that most $ETH will not be sold, and the improved liquidity and fee structure will make the asset more attractive to investors


8/ One thing is sure, this is one of the most anticipated events for the crypto community in a long time, so I'm going to be following its development closely to keep you all updated. 

Let me know if you'd like more threads on the Shanghai upgrade.


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Leverage in Crypto: Not A Tool To Be Avoided

Leverage is not the problem.
Your position size is.

Let me explain.


You have a $1,000 account.
Your risk per trade is 1%.

That means every trade that you lose should only lose you 1% of your account.

i.e. $10 per loss.

I could end it here.
Because this is all that matters.


It doesn't matter if you're on 100x lev or 5x.

As long as you're only losing ~$10 per losing trade, you're gucci.

If the stop loss on your trade is 1% away from entry...

Your margin will be:
$1,000 on spot (1% of $1,000 = $10)
$100 on 10x leverage (1% = 10% on 10x lev = $10)


Leverage is not a tool for you to take on irresponsible amounts of risk.

It's a tool meant to give you - the trader - the ability to commit less of your capital into any single trade, so that you can open multiple positions at once with the same amount of risk and capital.


If you want to get access to trading education that'll actually get you results:

https://theartofcrypto.co/our-group

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The Ethereum Shanghai Upgrade pt.1

Leverage in Crypto: Not A Tool To Be Avoided