Coinbase warns of delays for ETH unstaking after Ethereum Merge
Coinbase has warned its users that unstaking requests for ETH on its platform may take weeks or even months to process after the upcoming Ethereum network update in mid-April. The Shapella upgrade will enable stakers to withdraw their ETH holdings after they were locked up during the Ethereum Merge event in September 2022, which transitioned the network from proof-of-work (PoW) to proof-of-stake (PoS).
Coinbase anticipates a flood of unstaking requests once the functionality is enabled, but as a channel to pass unstaked ETH to customers once released by the protocol, it has no control over the on-chain processing of requests. Unstaking requests will open to all Coinbase customers at the same time and be queued based on when they are received.
While Coinbase cannot give an exact timeframe for unstaking, it expects considerable wait times due to the time it takes for the Ethereum network to process transactions. In the meantime, Coinbase provides a liquid staking option called "cbETH," which lets stakers trade ETH while it is still locked up, with the promise of redeemability at a later date.
The Ethereum Merge was a significant milestone for the network's scalability, transitioning from PoW to PoS to reduce energy consumption and improve transaction processing times. While the Ethereum network remains the leading platform for decentralized applications and smart contracts, ETH stakers have been unable to access their holdings since the Merge. The upcoming Shapella upgrade will finally provide a solution, allowing users to withdraw their staked ETH and stake more without being subject to an indefinite lockup period.
Overall, Coinbase's warning of potential delays in unstaking ETH highlights the complexities and limitations of on-chain processing. While the Ethereum network continues to evolve and improve, users must be patient and consider alternative options like Coinbase's cbETH to mitigate the inconvenience of locked-up assets.