Coinbase announced in a blog post that it will begin accepting withdrawal requests for staked ETH 24 hours after upgrading to the ethereumnetwork on Shanghai-based Shapella. Coinbase said, “The unstaking process is controlled by the Ethereum protocol, and we are only a channel, so it is not clear how long unstaking will take.” US customers will need to pay taxes on any rewards received before and after the upgrade. For U.S.-based Coinbase customers holding collateralized ETH (ETH2) or cbETH, Coinbase will issue any necessary 1099-MISC under general tax guidelines, including taxable activities related to these assets.
According to previous reports, the pledge platform Lido said that it is expected to launch the withdrawal of pledged ETH after the chain code audit is completed in mid-May to ensure user safety. Coinbase’s move to accept collateralized ETH withdrawal requests will provide greater flexibility to its customers, who will be able to access their funds earlier. However, it should be noted that US customers may need to pay taxes on any rewards for staking ETH, and Coinbase will issue the necessary tax documents.
The upgrade of the Ethereum network to Shanghai-Capella is an important milestone for the cryptocurrency community as it aims to improve the performance and security of the network. This upgrade includes several changes, such as updates to the transaction fee mechanism and improvements to network scalability. Coinbase’s decision to support the upgrade and accept withdrawal requests for collateralized ETH demonstrates the company’s commitment to providing its customers with access to the latest developments in the cryptocurrency ecosystem.
As the cryptocurrency industry continues to grow, so does the regulatory framework, with tax authorities around the world seeking to clarify the tax implications of cryptocurrencies. Coinbase’s move to issue the necessary tax documentation for U.S. customers holding staked ETH fits into this trend, and is likely to be followed by others in the industry.