Stakers of Ether who have seen their holdings remaining locked for the duration of the Ethereum Merge Event may soon be able to “unstake” and collect their funds.
Coinbase announced via a Twitter post that it may take weeks or months for unstaking requests to be fully processed on its platform. The social media post stated that Coinbase expects to receive a flood of requests for withdrawals after the ETH network update enables this functionality in the coming month.
In September 2022, Ethereum went from a proof-of work (PoW) model to a proof-of stake (PoS) model. However, stakers’ assets continue to be locked up. The merger created an, albeit temporary, situation where platforms such as Coinbase allowed its customers to stake ETH, but not withdraw it.
The Shapella upgrade to Ethereum will allow users to withdraw the ETH that they have staked. That upgrade is expected to occur in April. ETH holders are able to continue to stake more at this time, without any newly staked funds being locked up for an indefinite period.
Coinbase stated that all ETH staking requests will be processed on-chain and that the company will only serve as a facilitator, transferring unstaked Ethereum to customers after the protocol releases it. Coinbase announced that:
“Unstaking requests will open to all Coinbase customers at the same time and will be relayed to the Ethereum protocol and queued based on when they are received.”
After the upgrade is completed, users can log into their Coinbase account and begin making unstaking requests. This will happen within roughly 24 hours. Customers should expect a long wait after submitting their request.
Coinbase is not able to provide exact times for unstaking, as they have no actual control over the process. Although they have provided an estimate based on the time required for transactions to be processed by the Ethereum network, customers should expect a lengthy wait and Coinbase is asking for patience.
Coinbase is offering a liquid staking option known as “cbETH” to help compensate stakers for this inconvenience. This derivative of staked Ethereum allows stakers to trade ETH while it remains locked with the promise that any funds earned can be withdrawn at a later time.