The top 10 Ethereum over-the-counter addresses have dropped 11% in their holdings in the past three months. However, whale addresses on the exchange saw a 78% increase.
ETH whales move assets to exchanges before Merge
As you follow on Kriptokoin.com, the Ethereum Blockchain is moving from the current Proof-of-Work (PoW) mining consensus to a Proof-of-Stake (PoS). This upgrade is one of the most important updates for Ethereum since its inception.
The ETH team has scheduled the Merge date for September 15, after the successful Goerli test-net integration. Ethereum’s native token ETH surged in July after the Merge date was announced. Ethereum price rallied above $2,000 to a six-month high. But it failed to consolidate at critical resistance. The bullish enthusiasm in terms of token price and market sentiment turned to bearish as Merge approached. As a result, there has been a sharp decline in the holdings of a significant number of ETH whales.
Data from crypto analytics firm Santiment shows that the gap between Ethereum’s 10 largest non-exchange addresses and exchange addresses is closing. In the past three months, the largest whale addresses have sent significant amounts of ETH to exchanges. Over-the-counter addresses fell 11%, while exchange-based addresses rose 78%.
Ethereum’s 10 largest exchanges and non-exchange wallets / Source: SantimentThe flow of crypto to exchanges often reflects a bearish sentiment. Usually, traders do this to earn a profit by selling their tokens. According to analysts, this probably indicates that whales expect the price to drop in the near future.
Many market analysts also say that Merge will be a “buy the rumor, sell the news” event. This saying means that if good news is expected in the future, the price will usually go higher in anticipation of that date. But after that it doesn’t have to be. The market rallied after the Merge historic confirmation. However, it is possible that it will eventually see a price drop after the important event.
I think #Ethereum will drop so hard on the Merge day.
The whole anticipation is getting not bought up on the spot market but on the futures market.
Be warned.
— Crypto Rover (@rovercrc) August 23, 2022
What will Merge bring to Ethereum (ETH)?
Merge will mark the completion of the second of three phases in Ethereum’s transition to PoS. The process started with the launch of Beacon Chain in December 2020. The current phase was scheduled to be completed by mid-2021. However, the plan has now shifted to the third quarter of 2022, due to several delays. Phase three ‘sharding’ will introduce various scalability features. It will also be the most important phase as it will significantly reduce the energy consumption of Blockchain.
The September 15 event is an important milestone for Ethereum. But Merge only means a change in mining consensus. Key benefits such as higher processing capacity, lower gas fees and reduced energy consumption will come after the completion of the third phase.
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