The merge was undoubtedly the biggest moment of the year for cryptocurrency enthusiasts.
In September Ethereum, the second-largest cryptocurrency by market capitalization completely changes its network in order to adopt the proof-of-stake consensus mechanism.
This means that Ethereum changed the way the blockchain produces new tokens. Previously, Ethereum functioned under a “Proof-of-Work” consensus – which means that the network depended on cryptocurrency mining in order to create new currency.
Today’s Ethereum functions under a staking mechanism – which means that Ether holders can become validators (someone who is responsible for verifying transactions on a blockchain) in order to aid the network in producing new Eth, while also earning currency for themselves as a prize.
The transition for proof-of-stake was mostly well received by most of the community. In PoS, Ethereum is far more energy efficient while cutting the blockchain’s energy use by 99.9%.
Investing in Ethereum Post-Merge
Since the transition, the cryptocurrency world diverged about how the new consensus mechanism would fare in regards to attracting new investments.
According to Santiment, a crypto-analytic tool, Ethereum whale addresses owning one million or more ETH have collectively added 3.5 million more of the currency, or $4.55 billion, to their bags in the last few months.
With the additional additions, the holding of this particular cohort of investors, with 132 addresses, has climbed by more than 14%.
The harsh crypto winter has devastated the price of the world’s second-largest cryptocurrency. This year, Ethereum dropped by more than 75% since its all-time high of about $5,000 a year earlier.
The much-anticipated Ethereum “Merge” was also a “buy the rumor, sell the news” event that failed to significantly alter the token’s price trend. In reality, ETH has dropped 21% since the switch.
However, the most recent accumulation pattern contrasts that of another group of large investors – sharks and whales – who have lost more than 3 million ETH in the previous five weeks.
This might imply a move or redistribution among significant Ethereum holdings, which increased selling pressure and drove the ETH price to levels not seen since July.
The consolidation of Ethereum’s merge means that – once the cryptocurrency becomes deflationary – many anticipate for Eth to grow in value.
This significant move from crypto whales towards Ethereum has the chance of becoming good things for the cryptocurrency in the number-2 cryptocurrency in the world.
