Ethereum’s recent upgrade has pushed miners out of its network. Ethereum 2.0 supports validators that stake 32ETH or higher in the network.
The expectation of the community was for the merger to drive up the price of ETH, and other cryptos. After the merger, however, it was the reverse.
Related Reading: Ethereum: Can The Top Altcoin End Bitcoin’s Dominance Post Merge?
Just minutes later, Bitcoin had lost $1K. Ethereum lost $200 more, falling from $1,635 down to $1471 the same day. The ETH market landed on $1335.33 on September 18th, after a few more days.
Ethereum currently trades at $1344.45. The price has seen a decrease of 0.17% in the last 24 hours. The hourly increase is 0.17%. However, the seven-day price change indicates a loss of 15.91%. Source: ETHUSD price chart from TradingView.com
Ethereum Miners Drop ETH Holdings Increasing Pressure
It is important to remember that Ethereum does not operate with a proof-of work consensus mechanism. Combining its Beacon Chain with mainnet rendered miners ineffective on the network and replaced them by validators. Despite the fact that miners worked hard to fork the network, creating the ETHPOW token, attacks have occurred and the network is still not as robust and promising.
According to the crypto market, there would be a price shift from bearish bullish following the Ethereum upgrade. The Ethereum price fell and the amount of ETH available increased after the upgrade. It isn’t surprising, since miners began to dispose of their ETH coins prior to the merger.
Initially, Ethereum miners received 13,000 ETH per day via the PoW network. The new PoS gives validators only 1600 ETH. Miners’ rewards dropped by 90% after the merge, which could have lowered ETH supply advantageously, pushing the price upward.
Due to price movements and the upgrade effect, Ethereum miners sold off up to 30K ETH. This was the reason behind Ether’s price plunge from Merge day. Price losses were further aggravated by the constant selling that put pressure on investors.
It isn’t looking good for crypto assets at the moment. Many crypto enthusiasts are also selling off their assets as the market continues to decline.
What does this mean for Ethereum?
The price of Ether is set to continue falling as miners dump their ETH onto the market. Even though the other factors that could have boosted the price remain positive, miners’ exit from the Ethereum market has worsened everything for ETH.
Many analysts predict that Ethereum could drop as low as $750. That price will be reached if the miners sell more than usual and if macroeconomic factors take effect soon.
Similar Reading: 13% Discount on Post-Merge Profit-Taking cuts
The Feds rate increase is already causing panic. Investors are anxious about the Feds rate hike announcement, as this could cause the market to go bearish or bullish. If the rate stays 75 bps, there’s no problem. The market will be in serious trouble if the rate rises to 100 bps.
Featured image taken from Pixabay. Chart from TradingView.com