Ahead of the Ethereum Merge, investors are starting to pay more attention to the Ether (ETH) coin, while weighing whether it is safe to buy the coin as this huge update is coming.
During the first stage of the Ethereum Merge, Bellatrix, the price of ETH could not hold its daily peak and closed in the red. But for the next couple day, investors seemed to take advantage of the moment to collect more ETH because they believed it was an opportunity, with the hope that the price shot up after the Merge.
As we all know, the Merge the the process where the Ethereum network will switch to proof of stake (PoS) consensus which makes it more energy efficient, environmentally friendly, more scalable and lower cost.
With this change seen as a positive for the industry, many analysts expect that this change will gain more adoption in the technology.
ETH Price May Increase Due To The Merge
In theory, with the change to PoS system, it should have a positive impact on Ether price. Because the upgrade will affect the long term growth for the technology, and in return more people are expected to adopt it.
Since the completion of the Bellatrix update, the price of ETH has been on the rise which show signs that the market is bullish on the Merge. At the time of writing it is priced at $1,700.
The update will strengthen Ethereum as the best and largest platform for smart contracts. It can be a good fundamental basis for ETH coin to gain more adoption, as it is expected to have a positive impact on the DeFi and NFT sectors which are mostly built on the Ethereum network.
With the many changes happening on the Ethereum network, may increase the price of crypto gradually in the future as it is still the main choice in investing in crypto assets.
ETH Price May Decrease Due to The Merge
However, according to popular crypto analyst on YouTube, Jason Pizzino, actually sees the potential for near-term disaster in ETH prices due to the merge. He said that investors should also prepare for the worst.
From a technical analysis point of view, Jason sees the price of ETH still having to struggle against resistance at US$1,700, before really believing the bulls will take over the coin’s price movement.
In mid-August, ETH had been hit hard from the coveted level of US$2,000, and has not been touched again to this day.
“The warning forms a lower high from the previous high which I think will be a bit of a disaster, at least in the short term, medium term [which takes] weeks to months based on technical [analysis],” he added.
In a broader perspective, there is more opportunity for a decline in prices than an increase as the crypto market is currently still pressured by the US sentiment, created by the policies of the US central bank.
The Fed is feared to raise interest rates again to fight inflation, which is also expected to rise in this September report. That can shrink investors’ risk appetite for assets such as stocks and cryptocurrencies.
All in all, the Merge is major milestone for Ethereum. The update do improve the quality of life of the network, like allowing the network to process more transactions than before. Also, Ethereum’s adoption rate has been growing steadily in the past few years and has proved to be highly useful for a wide range of industries. However, it has been struggling to scale since millions of people started using it. With the Merge update will mark the end of scalability issues and the start of a new era for the network.