In a recent study, Ethereum’s transition to Merge and Proof of Stake was interpreted positively by one analyst for the price.
The main reason for this is that the return-hungry investors find the effect of the Merge event on the price positively.
Innovations in Ethereum with Merge Reflect on Price
With the launch of the Beacon chain, which came to Ethereum in December 2020, Ethereum staking became possible. With Etherum staking, those who stake are able to earn around 4 percent income.
The analyst, who predicts the Ethereum price, interprets this positively, as some of the transaction fees will go to the stakers together with Merge. With this income, the analyst thinks it will be more attractive to earn passive income by staking Ethereum.
ETH staked so far are locked and cannot be withdrawn immediately after Merge. However, it is thought that Ethereum’s long-awaited transition to Proof of Stake will provide confidence to investors who want to attract their ETH in the long run.
As Bitmex Research points out, the possibility of return with more Ethereum-based applications may also become attractive to investors.
The analyst believes that deflationary dynamics and reducing energy consumption with Ethereum Merge will not affect the price much.
The Etherem Merge is expected to take place less than two weeks from now. In this regard, Ethan Buchman, the founder of Cosmos, interpreted this event as a great development for the industry.
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