Here's how Ethereum whales are reacting to The Merge

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Quantum analysis explains how whale movements differed before and after the Ethereum merger.

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Ethereum funding rates are dropping at all times just before The Merge

As one analyst notes in a CryptoQuant post, many ETH investors have bet that the price would drop around the close of The Merge.

Notice

The relevant indicator here is the “funding rate”. It measures the periodic fee that traders exchange perpetual futures contracts with each other.

When the value of this metric is positive, it means long investors are currently paying short holders a premium to hold their positions. Such a trend indicates that a bullish sentiment prevails in the market at present.

On the other hand, negative readings of the indicator indicate that short investors are currently more important than long investors as the majority of investors are bearish.

The chart below shows the evolution of Ethereum funding rates over the past few days:

Ethereum Funding Rate: The metric seems to have been red so long ago | Source: CryptoQuant

As you can see in the chart above, Ethereum funding rates were falling a few days ago and hit a new negative high when The Merge came along.

The analyst explains: This is because investors thought that the PoS transfer hype had already affected the market. So they failed – believing that the price would drop after the much-anticipated event.

Immediately after the merger, however, the price increased slightly. When they saw that the drop they were waiting for was not happening, these short sellers began to close their positions quickly. Refinancing rates rose significantly as a result.

At that moment, the waiting whales jumped on the bandwagon and dumped their ETH, leading to a sharp drop in price. Analyst’s Comments: This is a sign that the whales are looking to make a move that will give them the biggest gains. The Analyst: