Since The Merge on September 15th, the 2 flagship cryptos have been struggling and are constantly declining. The US Federal Reserve is about to make an announcement that should change the game. Let’s look together at the market situation for these cryptos and the possible developments in the coming days.
Ethereum struggles to take off after The Merge
As you probably know, Ethereum has just entered “Proof of Stake” which represents the most important update in the history of this crypto. If the Merger went very well technically, the same cannot be said for the value of the asset. Basically, the price fell 21.03% from the merge and shows €1,296.39
If the price remains generally bearish and no real rise has been seen after The Merge, we can still predict some hopeful signs. First, the fact that thean asset becomes deflated it will have the effect of increasing its scarcity. If the demand is present it could increase the value of Ethereum. Another interesting factor to consider is the energy consumption reduced by more than 99% after the upgrade. This argument may attract some investors.
The current bearish momentum can be explained because the explosion of the inflation rate. Economists noted that the rate had not been so high in the last 40 years. The traditional markets are also in trouble since the NASDAQ 100 fell 2.7% in one week and 5.34% for the CAC 40.
Another factor that strongly influences the markets is obvious the energy crisis in Europe. The latter is largely due to the conflict between Ukraine and Russia since 20 February. Two weeks ago, Russia shut down the Nord Stream gas pipeline to pressure Europe to lift sanctions against it.
Bitcoin follows the same pattern as Ethereum
At the time of writing, Bitcoin is struggling around €18,495.67 and is down 4.54% in the last 24 hours. Even if it peaked above €22,000, it was only a short time ago fell to its lowest level in the past 30 days. The asset is even breaking through this critical threshold and continues to fall.
If we compare the prices of the 2 star cryptocurrencies, we see that they both follow the same pattern.
After the biggest event in the history of Ethereum since its launch, price movements are mostly the same as Bitcoin.
Was the success of the Merger already priced in, or was it insignificant in the short term for the market? pic.twitter.com/hUsx2ThDBg
— Tim Haines 🇺🇦 (@TimHaines) September 15, 2022
“After Ethereum’s most significant event since its launch, its price curve largely follows that of Bitcoin. The success of the merger was already factored into the prices, or was it insignificant in the short term for the market?”
Shortly before The Merge, experts predicted an increase in the value of Ethereum, however, this increase was short-lived and the price of ETH fell very quickly.
Twitter user “Doctor Profit” followed by nearly 40,000 people on the network announced that he had sold all his Ethereum tokens. The netizen predicted the fall of Bitcoin to $18,000 when it reached a peak of $60,000 and warned of the possible crash in Terra Luna.
Just sold mine #ETH a couple of days ago.
I have zero Ethereum at this time.I will wait a few weeks/months until I decide to re-enter Ethereum. pic.twitter.com/H8HokDUnOJ
— Doctor Profit 🇨🇭 (@DrProfitCrypto) September 18, 2022
The Profit Doctor announced that he wants to wait a few weeks or even a few months to find out if he will reinvest in Ethereum again. In fact, the current market allows for a great uncertainty on the evolution of the asset in the coming days. In addition, people seem to position themselves as spectators after The Merge, which is still a completely new event in the young world of cryptocurrencies.
Technical problems before the upgrade
This weekend, a report announced that the Ethereum Blockchain had its first “replay attack” Where replay attack in French. This technique involves intercepting network transmissions through identity theft. Moreover, the launch of the new PoW Ethereum Blockchain did not go as planned. Indeed, this one has experience Identity issues which scared off many investors.
1/ Warning | BlockSec felt that the message (calldata) of the PoS chain is being relayed by miners @EthereumPow. The root cause of the exploit is that the bridge does not correctly verify the actual data (fed by itself) of the cross-chain message.
—BlockSec (@BlockSecTeam) September 18, 2022
FED announcement long expected in the world of cryptocurrencies
Profit Doctor also made predictions for Bitcoin in the coming months based on the curves between 2013 and 2016.
#Bitcoin entering the ‘Bottom’ phase, expecting goals between $18,000 and $25,000 until March 2023. The bottom is being formed. I will continue to accumulate at these prices
This is based on TA only. Please consider the next decisions regarding FEDs. 0.75 already priced in, 1bps and we see blood. pic.twitter.com/LRAgoBl6va
— Doctor Profit 🇨🇭 (@DrProfitCrypto) September 18, 2022
The user warns about this prediction and indicates that it is necessary to take into account the announcement of the American Federal Reserve in the future. Bitcoin is able to withstand a 0.75 point rise in interest rates but if it comes to 1 “it will be bloody”.
Cryptocurrencies are sensitive to this interest rate, which is why the crypto world is eagerly awaiting the Fed’s announcement. This will take place on 21 September.
