Ethereum’s latest update kicked miners out of the network. Now Ethereum 2.0 supports validators with 32ETH and above in the network.
The community expected the merger to boost the value of ETH and other cryptocurrencies. But the reverse happened after that.
Related Reading: Ethereum: Could Top Altcoin End Bitcoin’s Dominance Post Consolidation?
A few minutes after the event on September 15, Bitcoin lost $ 1 thousand. Ethereum lost more than $200 on the same integration day, falling from $1,635 to $1,471. Over the next few days, on September 18, the price of ETH plunged deeper and landed at $1335.33.
Currently, on September 21, Ethereum is trading at $1344.45. This price represents a 0.17% price drop in 24 hours. The hour shows a gain of 0.17%, but the 7-day price movement shows a loss of 15.91%.
Ethereum miners are putting increasing pressure on holding ETH
Keep in mind that Ethereum no longer operates on a consensus-of-work mechanism. The combination of the beacon chain and the mainnet made miners useless on the network, replacing them with validators. Although miners hard fork the network that creates ETHPOW, the new network has been attacked and is not yet strong and promising.
The crypto market is expected to see a price reversal from bearish to bullish after the Ethereum upgrade. But after the event, the price of ETH decreased, and the supply of ETH increased. This is not surprising because miners started dumping their ETH coins before the merger.
Ethereum miners initially earned 13,000 ETH per day on the PoW network. But on the new POS, validators only get 1600 ETH. Miners’ rewards dropped by 90% after the merger, drastically reducing the supply of ETH and sending the price skyrocketing.
Unfortunately, Ethereum miners lost up to 30K ETH holdings due to the price movement and upgrade effect. This was the reason behind the fall in the price of Ether on the day of the merger. The continued sell-off resulted in further price loss for investors.
The current state of crypto assets is not promising. As prices continue to decline, many enthusiasts are dumping their holdings.
What are the implications for Ethereum?
As miners continue to dump their ETH on the market, the price of Ether goes down. Although other factors that could boost the price remain positive, the withdrawal of miners from the Ethereum market has made things worse for ETH.
Currently, many analysts predict that Ethereum may drop to $750. If miners continue to sell off coupled with macroeconomic conditions, that price level could happen soon.
Related reading: Post-merger profit-taking lowers Ethereum’s ratio over BTC by 13%
Moreover, the Fed’s impending rate hike is causing panic. Many investors dread the announcement because it can make the market panic or panic. If the speed remains at 75 bps, there is no problem. But the market is in trouble if it goes up to 100 bbc.
Featured image from Pixabay and chart from TradingView.com