The Merge was successfully completed on September 15, but Ethereum (ETH) continued to decline as traders anticipated that a dip under the $1,700 mark would result in the opening of several short positions. Considering the hysteria surrounding the Merge, whales began liquidating their ETH holdings last month. A further decline below $1430 will be catastrophic for the asset, which has currently reached an inflection point.
A Dangerous Stage For Ethereum
In the week following the Merge, Ethereum’s market capitalization dropped by approximately $40 billion, and another $25 billion in that week alone. Whales leveraged the most anticipated event in the cryptocurrency market to unload their Ethereum (ETH) holdings just before the price drop.
According to the Merge story, experts had forecasted that the Ethereum price would drop, which it did as “whales” dumped over $1.5 billion worth of ETH in only two days. In reality, the price has reached a pivot point, with support coming in at $1,430 due to heavy selling by “whales.”
Several crypto specialists have predicted that if the price of ETH drops below $1430, it might hit $1,000, a claim supported by analyst Ali Martinez.
Why Is Ethereum Capitulating?
Over $1.5 billion in ETH was dumped by whales over the previous 48 hours, according to Whale Alerts. The cryptocurrency exchange Binance has received a massive transfer of 240,099 ETH from an anonymous “whale” valued at almost $357.90 million. Additionally, many “whales” have made massive ETH transfers, totaling between $50 million and $100 million.
Additionally, on September 30th, options worth $2 billion in Ethereum will lapse, which is a cause for concern and can cause the ETH price to plummet further. Considering Ethereum is now a deflationary currency, its supply will decrease as well. As time passes, the number of ETH available will decrease because of the EIP-1559 burning mechanism. Nonetheless, statistics show that 400 ETH have been added to the supply since Merge.
What Lies Ahead For Ethereum?
During his tenure as SEC chair, Gary Gensler had hinted that the Merge had rendered Ethereum safe. According to him, the “Howey Test” security criteria are met by any PoS cryptocurrency or issuer that lets holders stake their coins.
Therefore, Ethereum’s switch to PoS will have lasting consequences. The next move will be Surge, Verge, Purge, and Splurge which will mark the subsequent stages of the Ethereum Roadmap.
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