The cryptocurrency market fell almost 10% at the hands of Ethereum, after “The Merge”. Merger expectations had driven the price of ETH in early September from $1,500 to almost $1,800 on September 10. However, the fall in the markets on Tuesday caused by higher-than-expected inflation in the United States, affected cryptocurrencies.
The expectation around the change of the consensus mechanism in Ethereum was due in part to the fact that it is the first large network to leave mining and adopt the Proof of Participation, affirmed an article from Criptonoticias.
Barely a few hours have passed since the Merge in Ethereum and the confirmation that there will be a new token whose network will continue mining. However, already the price of that new token traded on a handful of exchanges has plummeted in the market. The ETHPoW (ETHW) quote, a representation of the future token of the hard fork present on exchanges such as FTX, Bitstamp or Poloniex, fell up to 50% after the activation of the Merge.
It is worth clarifying that what is traded on the exchanges is a representation of that token, which would be launching this evening, Thursday, September 15.
In the hours after the Merge, the price of ETHW fell from over $50 to around $18 according to CoinGeko. This price arises from an average between the exchanges where it is traded, although given the low liquidity and trading volumes of ETHW, the data varies a lot between one platform and another.
Cryptocurrencies: what do analysts think?
Pundits expect the rise of the leading digital currency to continue in the coming days and push the entire market as pointed by the RSI (Relative Strength Index), which is showing a bullish divergence on the daily time frame.
“This occurs when the price makes a lower low and the RSI indicator makes a higher high, which usually leads to a future uptrend,” explains Marcus Sotiriou, an analyst at GlobalBlock.
However, analysts remain cautious as the macroeconomic environment continues to cause fear among investors due to the European energy crisis.
What is the Bitcoin Lightning Network?
But while this news gives reason to the pessimists, the fundamentals of bitcoin are growing day by day, as the number of bitcoins in the lightning net continues to set all-time highs. There are almost 4,700 Bitcoin on the Lightning Network. Additionally, MicroStrategy announced Tuesday that it is working on solutions to bring millions of people onto the Lightning Network.
The Lightning Network is a scalability solution built on top of bitcoin, allowing users to quickly send and receive BTC with virtually no fees, “so if this is adopted globally, ‘crypto’ will have strong utility with a payment network,” says Sotiriou.
In the market, however, they are on alert due to the proximity of a possible “black swan” in September, which could take prices to the lowest in the year.
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Source: Ambito
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