Investors Withdraw ETH Holdings Despite Successful Ethereum Merge

Experts and investors had predicted an Ethereum price drop before the merge. Investors and traders accordingly traded carefully. The merge hype was referred to by popular analysts as “buy the rumor and sell the news”.

Valuations of ETH, BTC and other Altcoins were affected by volatility due to tightening Fed Reserves and other market factors.

After the merge event, analysts’ predictions proved right as the ETH price crashed below the support level. Several ETH investment were withdrawn. A few new additions were also recorded.

According to reports, ETH investment decreased by $15.4million, but BTC investments increased $17.4million. These data may indicate that Bitcoin-focused investors switched from Ethereum.

The Ethereum price plunged seriously, contrary to all the hype surrounding the merger. In September, some merge supporters thought that Ethereum would attract more investors after the merge. It seems that the opposite is true with last week’s outflows despite an easy transition.

Ethereum price drops

The ETH price plunged from $1,800 up to $1,300 between the merger and today. This record indicates that many investors, who had previously retained their ETH holdings, have now sold them. Experts have predicted a drop to $1,000 in Ethereum’s price if it falls below $1,250.

Investors Withdraw ETH Holdings Despite Successful Ethereum Merge ETHUSDT drops to below $1,400

The Binance exchange rate for ETH/BTC was 0.0817BTC in the early hours on September 15. ETH’s value fell to 0.0746 BTC a few hours later. The decline continued. ETH price didn’t only fall against BTC; ETH/USD exchange value dropped too. Although ETH holders weren’t happy with the decline in prices, many are hopeful that the market will recover over time.

Matthew Sigel from VanEck is head of research on digital assets. He’s one of many optimistic investors. Sigel said that the post-merge USD/ETH performance was similar to BTC’s after major changes. Sigel believes ETH will stabilize, but is uncertain when.

SEC Says Proof-Of–Stake Cryptocurrencies Could Be Considered Securities

Gary Gensler was the chairman of the Securities and Exchange Commission and commented last week about staked cryptocurrencies. According to the Wall Street Journal, the regulator suggested that staked cryptos might fall under regulation. The regulator explained further that Staked crypto could be considered securities.

Following Gensler’s comment, there may be regulatory uncertainties surrounding the new Ethereum proof-of-stake Token. Corporate investors might not be interested in investing in Ethereum because of the regulatory uncertainties.

According to the Journal, Ethereum’s proof-of-stake caught SEC’s attention. Gensler also noted that proof of stake coins are subject to contract attributes, and therefore will be subject to SEC regulations. Gensler’s comments came out hours after the completion of the Ethereum merge.

Although Gary didn’t categorically point at Ethereum, his comment might have contributed to the fall in Ether price last week.

Get more Crypto News at CFX Magazine