Ether Slips Post-Merge Alongside Solana, Cardano, And Algorand While Ethereum Classic Rises

In what appears to be an instance of buy the rumor, sell the news in crypto, ether is falling the morning after Ethereum completed its long-anticipated Merge at 2:42 am EST.

After surging nearly 3% immediately following the network completing its transition from an energy-intensive proof-of-work system for processing transactions to a proof-of-stake setup that will virtually eliminate its carbon footprint, the asset is down approximately 0.8% over the past 24 hours, trading at $1,589.70.

This move is not surprising as crypto has a history of selling off big news and ether had surged more than 30% in the runup to The Merge as it became more likely. There was also a recent surge of ether deposits onto crypto exchanges, according to data from Glassnode. A rush in deposits is usually a bearish signal, as long-term holders prefer to have their assets off exchanges and in the safety of direct custody. However, part of this surge could be due to ether holders anticipating the receipt of free tokens from an expected splinter of Ethereum, referred to as ETHPoW, which aims to continue a version of Ethereum with its proof-of-work setup. Anyone who owned ether at the time of the split would be eligible to receive these free tokens., Given questions about ETHPoW’s long-term viability, many recipients could be looking to sell immediately after receipt. The easiest way to do this would be by receiving them directly on exchanges that plan to list the token.

Other recent examples include bitcoin reaching highs just short of $70,000 twice in 2021, first in April when Coinbase went public via a direct listing on the New York Stock Exchange and then again in the fall when the CME Group
CME
listed the first bitcoin futures ETF, the ProShares Bitcoin
BTC
Strategy ETF.

Ether is also trailing most major competitors, including solana, cardano, algorand, avalanche, and polkadot this morning, though all are down following the transition. These proof-of-stake tokens are those most threatened by Ethereum’s completion of The Merge, which not only places it on par with their respective platforms in terms of their carbon footprints but also because Ethereum’s next set of planned updates dubbed the Surge, Verge and Purge will make the platform more efficient and aims to increase its throughput from a couple of dozen transactions per second to 100,000.

Other more notable digital assets are positive following the news. Ethereum Classic, a fork of the original Ethereum blockchain that maintained its proof-of-work setup is up 6.69% since the merge and 165 percent over the past three months. Ethereum Classic has seen a massive surge in mining activity as Ethereum’s miners look for new platforms to support. Blockchains like Ethereum Classic, Ravencoin, Beam, and others are compatible with Ethereum’s GPU-based mining equipment, though none appear to be able to profitably absorb the amount of computing power now available. Bitcoin uses a different type hashing algorithm and requires a more specific type of computer chip for mining, making it a non-option of Ethereum miners.

In addition LDO, a governance token used to operate liquid staking platform Lido, which provides instant liquidity to ether stakers rather than having tokens being locked in the platform for 6-12 months is also up 4.31 percent.

Furthermore, bitcoin is up a slight 0.12% since The Merge.

Furthermore, bitcoin is up a slight 0.12% since The Merge.