Ethereum Plummets Despite Merge, What Has Gone Wrong?

The Bellatrix upgrade went live on the Beacon chain of Ethereum yesterday. It marked the start of the Ethereum merge, which will end with the Paris upgrade. Despite the enthusiasm around the merge, the Ethereum price has gone down by close to 8%. It is currently trading at $1,510. 

 The Ethereum merge is supposed to be a massively bullish event for ETH and crypto, in general. The drop in prices is a cause of concern for investors. 

The Aftermath Of Bellatrix

The Bellatrix upgrade went live yesterday. Bellatrix upgrade marks the beginning of the merge. It also gives the validators the ability to create Beacon blocks. The code for the merge will also be contained in one such block. 

The network participation rate of Ethereum went down after the Bellatrix upgrade. According to experts, the fall can be attributed to the failure of some nodes to upgrade their clients. They believe that the participation will increase as more and more validators upgrade their nodes for the Bellatrix upgrade.

A more worrying sign is that the missed blocks rate of Ethereum went up by 1700% after the upgrade. The developer team at Ethereum will closely monitor the situation since the merge is just a week away.

Why Ethereum Prices Are Falling

Adam Cochran, a crypto influencer and partner at Cinneamhain Ventures, believes that the plunge in Ethereum prices might have other reasons. He believes that Aave’s decision to pause Ethereum markets caused platforms like Instadapp to unwind in stETH/ETH pools. He believes that the next Ethereum lows may happen due to trade unwinding. 

The macroeconomic factors are also not helping Ethereum. The Fed is expected to continue its hawkish stance to tackle inflation. The dollar continues its rally leading to a major rut in the crypto and general markets. 

The crypto investors will anxiously wait for the September 13th CPI reveal. The merge will also be completed somewhere around the same date. The dual factors will have a major impact on the Ethereum price.