Bank of America has warned that the limited throughput of Ethereum and increasing competition from alternative blockchains will constrain its adoption and usage, despite its first-mover advantage in introducing the idea of blockchain operating systems compatible with smart contracts and decentralized applications. The Shanghai upgrade, due to occur later today, will enable validators to withdraw staked ether and rewards that have been locked up. However, the upgrade does not address scalability and acts only as a precursor for future upgrades. Bank of America's report suggests that Ethereum's long-term viability will depend on the execution of its development roadmap, which includes the implementation of a sharding approach called Danksharding, but this is still years away. The bank expects heightened volatility around the upgrade due to decreased liquidity, derivatives activity, and because of the ether price action seen around the previous upgrade, the Merge.

(By Will Canny)