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The Ethereum (ETH) price has gained 30% in a week after the announcement of the Merge in mid-September. However, Ethereum seems to have attracted the attention of whales as the Ethereum fees reach historically low levels from where a rebound is usually expected.
Ethereum Rises 30% on Bullish Expectations
Ethereum developers last week announced the prospective Ethereum mainnet merge with the Beacon Chain on September 19. The transition to proof-of-stake (PoS) will reduce the gas fees and increase the number of transactions per second drastically.
The Merge announcement, as well as, gas fees hitting significantly low has caused the ETH price to rally nearly 30% in a week and 10% in the 24 hours.
Historically, the Ethereum (ETH) price has rebounded massively during annualized ETH fees dropping near value 1. In mid-2021, the ETH price skyrocketed massively to hit its ATH of $4891 after the gas fees hit bottom levels. Thus, a drop in ETH fees could mean a rebound in ETH price.
According to Santiment, the Ethereum (ETH) Whale Supply Distribution data indicates the return of 131 whales holding 1k-100k ETH at current levels.
“Ethereum has recovered quite well in July, up +29% for the month and +14% alone in the past 24 hours. Additionally, there’s an increase in the key 1k to 100k ETH address tier since early May where 131 new whale addresses have popped up on the network.”
The massive jump in whales addresses at low ETH gas fees has resulted in the price surge. If the trend follows the historical data and whales keep accumulating, the Ethereum (ETH) price could rise above the $2000 level before the merge.
However, it is believed that Ethereum will remain deflationary at the merge. In the last 30-days, ETH annualized 1.2 million of fees. Moreover, 1.0 million of Eth is coming out of the system, at 85% burn rate. According to Ethereum staking stats at Merge, 0.7 million ETH issuance to validators.
ETC Price Soars Higher
Ethereum Classic (ETC) has gained 19% in the last 24 hours on the back of retail buying as whales have sold ETC holdings. The ETH rally could be a major factor behind the rise in the ETC price.
Several analysts have warned investors to be cautious as the rally could be short-lived. Analysts believe the rally lacks a significant trading volume, which means the price could dive soon.
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