The ETH merge may be the catalyst for another huge leg down…

I really think there is a more than likely chance that when the ETH merge happens, or right before it will trigger a massive “buy the rumor sell the news” event.

ETH has been pumping recently and I suspect this is the “buy the rumor” phase.

IF there is to be lower lows and another big leg down in the crypto markets I think the ETH merge could be the perfect storm that provides that.

So, I guess to hedge against this possibility I would be taking some profits on the way up. Or at least keeping dry powder on the side to see how things play out sept-dec.

Also, if the merge doesn’t go off perfectly that could also be reason for a sell off in the mid to short term. I would argue there’s a much higher chance the merge has issues or gets pushed out and delayed further.

What do you guys think?

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43 thoughts on “The ETH merge may be the catalyst for another huge leg down…”

  1. During the 6+ months between the merge and the update that enables withdrawals, there will be zero new ETH issuance to miners or stakers that’s immediately liquid and available to sell. It’s hard to argue that’s priced in, imo.

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  2. It’s possible. It brings to mind (quite recently) a very large deposit into the beaconchain that happened shortly after a testnet was sucessfully merged. So people are definitely keeping track of this with many different metrics.

    As the technology progresses, this makes people more comfortable with holding ETH.

    Depositing into the beaconchain when it launched in December 2020 was quite risky, it was brand new and there were many unknowns about what the future held.

    Today the merge is looking closer than ever. Three testnets have been “merged”, they are Kiln, Ropsten and Sepolia. There have been 10 shadowforks and there is one more testnet to be merged Goerlie, which is happening in a few days.

    If that all goes well, they will set a tenative mainnet date and review it one week later to see if it should be kept or changed.

    If something did go wrong, I think it would also depend on how severe it is too. There were some previous merge testnet issues, but they turned out to be minor (and mostly config) issues, which posed no threat.

    Overall things are looking very positive.

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  3. Nah. As soon as it happens there in excess of 10k ETH daily sell pressure evaporated overnight.

    There are also plenty of people hedging positions in the event that it doesn’t go smoothly, and these positions will be sold off, for ETH, if it happens without a hitch.

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  4. I’ve been holding for a pretty damn long time and nothing at this point will make me want to sell, so yeah…. I don’t care

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  5. In general hard forks bring volatility with them. Expect some wild swings both directions for ETH and the market overall

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  6. It will be a letdown because its been hyped to infinity.
    Thats the main reason. No matter how good the release will be

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  7. eth will only go higher within the next few years even if it has a massive correction in between now and then. eth is the king, it will flip btc and to the holders who have been here for the past few years, WAGMI.

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  8. I remember the ADA smart contract ‘release’, it was a big dump. I wouldn’t be surprised that this could also happen with ETH! Good point OP.

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  9. It’s funny as I actually have been putting fiat aside in the case that this does happen ,I hope it doesn’t but with crypto everything is unpredictable lol …

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  10. I want to have an opinion, I really do but since I’m locked up I’m just gonna comment casually about that instead

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  11. “Dry powder” – this is the first time having heard that term. I assume it means – cash on hand to buy if there’s a significant dip?

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  12. Even BTC was launched after 2009 and the Global Financial Crisis. When folks are losing their jobs, crypto is the last thing on anyone’s mind. I think a 50% drop from here is not only possible but probable.

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  13. Gonna be funny when people think they’re selling the news only to watch ETH rise 10x over 6 months as all supply is turned off and issuance drops by 90%. They’ll FOMO back in at $5k.

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  14. I’m not making the mistake of assuming that merge is as close as they say it is, but afaic there’s no good reason not to have a gang of limit buys in for every coin you like in case of a massive selloff. I’m sure as hell not missing my chance to buy at those levels again (or lower). My lowest limit buy I have ready for ETH right now is at $585 lol

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  15. The catalyst for the leg down will be the macro environment, not anything to do with Ethereum. Just keep stacking your bags at any level you can afford.

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  16. I think there will be some chop while it happens and a lot of locked ETH will become available to move when the merge happens. Ultimately, this upgrade is necessary and gold for ETH in the long term so I’m not too worried about short term down movements.

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  17. It could well be a dump, especially if the merge is glitchy. Also the ETH2 stake holders may go on a selling spree. Their funds have been locked up for a long time and when unlocked give them the ability to do other things with their money.

    On the other hand, a smooth merge and hype over energy saving benefits of POS over the old POW, coupled with new stake opportunities could send the chart into the green.

    Probably the only valid prediction is that it’ll be volatile.

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  18. “Buy the rumor, sell the news” is quoted all the time on here by people who don’t even know what that means.

    The idea behind “buying the rumor” is that assymetric information gives an advantage to knowledgeable investors. “Selling the news” means everyone knows about it, the market is mature, and it’s priced in.

    There is no way the effects of the merge – which include maybe 80% decrease in issuance and ends the environmental argument against it – could be priced in by this market. So many people invested in eth are still completely ignorant of what the merge even is, and have no idea about the many improvements still to come in the next few years.

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  19. Well, there are many people that locked their ETH and ever since the price has pumped quiet a bit. So I assume atleast some of them will sell on unlock.

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