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Ethereum Scarcity Increases as Net Daily Issuance Hits a 2-Month Low

The daily net issuance in the Ethereum (ETH) network continues to drop, signifying a supply deficit.

Data analytic firm IntoTheBlock explained:

“ETH net daily issuance is dropping. after reaching a top on March 12 of 3.48%, the 7-day average net issuance has been around 2.21%. ETH has not had a negative net issuance day since January 10, but it reached a 2-month low on Tuesday of 0.87%.”

Source: IntoTheBlock

Ethereum issuance entails the available Ether on the network, given that it’s the difference between mined Ether and the one burned after being used in transactions. The burnt Ether mechanism was introduced after the London Hard Fork or EIP 1559 upgrade went live in August 2021.

Therefore, a slip in Ethereum’s net daily issuance is bullish because it illustrates scarcity in the network, and depending on the demand available price is expected to increase.

The second-largest cryptocurrency was up by 1.5% in the last 24 hours to hit $3,263 during intraday trading, according to CoinMarketCap.

The merge is expected to be a game-changer

The much-anticipated merge slated for Q2 of 2022 will serve as the biggest software upgrade in the Ethereum ecosystem. It will prompt a transition from the current proof of work (PoW) to a proof of stake (PoS) framework, deemed more environmentally friendly and cost-effective.

Market analyst Lark Davis expects the merge to prompt a supply growth rate of -2.8% in the ETH network. He explained:

“At -2.8% supply growth a year post Merge, Ethereum will see about 3.3 million ETH a year burned. By the end of the decade total ETH supply will drop under 100 million. Or put another way, we will burn the equivalent of ALL ETH currently sitting on exchanges.”

Source: Glassnode

A previous study by LuckyHash noted that the merge would trigger a 1% annual deflation rate.

Therefore, the merge is viewed as a game-changer that will boost Ethereum as a deflationary asset, given that the London Hardfork or EIP 1559 upgrade already set the ball rolling.

Ethereum Unlikely to Merge in June, Despite PoW Undergoing

The much-anticipated merge of Ethereum will not occur in June as planned, according to Ethereum lead developer Tim Beiko.

Beiko took to Twitter and tweeted:

“It won’t be June, but likely in the few months after. No firm date yet, but we’re definitely in the final chapter of PoW on Ethereum.”

This revelation comes days after the first shadow fork that served as the merge trial went live on the Ethereum mainnet.

The shadow fork was to stress test syncing and state growth on the ETH network, as revealed by Ethereum Foundation developer Parithosh Jayanthi.

The merge will act as the biggest software upgrade in the Ethereum ecosystem by shifting the current proof of work (PoW) framework to a more cost-effective and environmentally friendly proof of stake (PoS) consensus mechanism.

Furthermore, validators will take up the role of miners when it comes to the confirmation of blocks based on the amount of ETH staked, acting as collateral against dishonest behaviour.

Despite the PoW consensus mechanism on the Ethereum network is in the final stretch, Beiko did not give a precise date when the merge would happen, but he opined that it would happen a few months after June.

A transition to the PoS will improve scalability by enabling upgrades like sharding on the ETH blockchain.

The merge is being waited with bated breath because it will enhance Ethereum’s quest to be a deflationary asset. Its value is expected to continue increasing with time on the foundation of slashed supply.

The second-largest cryptocurrency was up by 1.97% to hit $3,108 during intraday trading, according to CoinMarketCap. Ethereum reached an all-time high (ATH) price of $4,850 in November last year, but it has not yet reclaimed this level so far this year.

Ethereum Merge Might Happen in August as Testing Enters Final Round

Speaking at the Permissionless 2022 Conference in Florida, the U.S., Ethereum Researcher Justin Drake disclosed that the merge of Ethereum (ETH) might happen in August.

Market insight provider Bankless pointed out. He noted:

“Strong desire to make this happen before difficulty bomb in August. Stars are aligned.”

Meanwhile, Ethereum core developer Preston Van Loon shared similar sentiments that testing was in the final stages and said:

“As far as we know, if everything goes to plan, August—it just makes sense. If we don’t have to move, let’s do it as soon as we can.”

The merge, which will transition the current proof-of-work (PoS) consensus mechanism to a proof-of-stake (PoS), has been elusive because it was slated for June.

Previously, Ethereum lead developer Tim Beiko revealed that the shift would not happen in June as planned. He pointed out:

“It won’t be June, but likely in the few months after. No firm date yet, but we’re definitely in the final chapter of PoW on Ethereum.”

The merge is estimated to be the biggest software upgrade in the Ethereum ecosystem because the PoS algorithm will allow the confirmation of blocks in a more energy-efficient way. After all, it requires validators to stake Ether instead of solving a cryptographic puzzle.

Validators will take up the role of miners when it comes to the confirmation of blocks based on the amount of ETH staked, acting as collateral against dishonest behaviour.

The merge is usually regarded as a game-changer that will give the Ethereum network a new face because it is expected to enhance scalability through upgrades like sharding.

Furthermore, it is anticipated to strengthen Ethereum’s quest as a deflationary asset because the second-largest cryptocurrency’s value is speculated to increase based on slashed supply.

Market analyst Lark Davis had previously opined that he expected the merge to trigger a supply growth rate of -2.8% in the Ethereum network. Moreover, a LuckyHash study noted that the shift would prompt a 1% annual deflation rate.

Octopus Ventures Leads $9.5m in Seed Round for Web3 Fintech Firm Merge

Merge, a next-generation fintech startup that provides crypto and web3 companies with a range of banking and payments solutions has raised $9.5 million from venture capital firms led by Octopus Ventures.

While the valuation of the company remains unknown, Merge noted that the funding round also enjoined participation from Hashed, Coinbase Ventures, Alameda Research and Ethereal Ventures, alongside angel investors, which included some of the biggest names in both crypto and traditional finance; the founder of Aave, co-founder of Polygon, CEO of Ledger, and former CEO of Barclays Consumer Banking, amongst other prominent investors.

The Web3.0 ecosystem is projected to be worth a $1 trillion market, but limitations still exist in bridging the gap between traditional companies with their blockchain counterparts. Merge provides a solution through its API infrastructure that enables firms to create bank accounts, complete transactions, and adhere to compliance effectively.

“As the crypto economy moves further into the mainstream, it’s increasingly clear that the current financial infrastructure isn’t fit to serve the rapid expansion of crypto-native businesses and many providers aren’t specialised enough to gauge risk,” said Zihao Xu, an investor at Octopus Ventures, adding that:

“Merge’s vision is to build the infrastructure necessary to allow crypto businesses to operate without fear of shutdown by regulators or third-party risk teams. We’re excited to back them as they build that and, ultimately, unleash even more innovation in crypto and defi.”

Investors and companies are particularly interested in startups that offer a very robust infrastructure that can help sustain the mass adoption of Web3.0 startups. While Merge is one of the many in this space, the deep expertise of its founders, led by former Paypal and Barclay’s engineer, Kebbie Sebastian, comes off as one of the many advantages Merge stands to benefit from in meeting the promises to both customers as investors alike.

Will Ethereum Merge Trigger a Shift from Selling to Buying Pressure?

The merge of Ethereum (ETH), which is expected to complete the transition from the current proof-of-work (PoS) consensus mechanism to a proof-of-stake (PoS) framework, has been elusive for quite some time.

Nevertheless, a DeFi educator under the pseudonym Korpi believes it will be a game-changer because it will shift the selling pressure experienced in the Ethereum network, given that structural supply will change to structural buying. The educator explained:

“The Merge is a substantial change in supply or demand forces most people underestimate. Multiple Ms of daily sell pressure on ETH will be replaced by buy pressure. Every day we will need new sellers to prevent the price from going up.”

Source: Korpi

The DeFi educator also acknowledged that if the merge happened today, the $10 million of daily selling pressure witnessed in the Ethereum network would be changed to $8 million of buy pressure. Korpi added:

“Let’s confront structural supply and structural demand on a daily basis. PoW: Daily Sell Pressure: $19M Daily, Buy Pressure: $8.5M, Net: $10.5 of SELL PRESSURE every day. PoS: Daily Sell Pressure: $0.3M, Daily Buy Pressure: $8.5M, Net: $8.2M of BUY PRESSURE every day.”

Source: Korpi

Since the merge will bring both chains together, Korpi believes this will trigger a 90% issuance reduction, which will prompt a supply deficit. The educator noted:

“Every day ~13,200 ETH is issued to miners on PoW chain and ~1,590 ETH to stakers on PoS chain. ~14,790 new ETH daily corresponds to a 4.5% annual issuance rate. At the Merge block, both chains ‘merge’ into one, and the PoS era begins.”

Previously, analyses have shown that the merge will trigger a deflation rate in the ETH ecosystem based on slashed supply.

For instance, crypto service provider LuckyHash stated that a proof-of-stake consensus mechanism would prompt a 1% annual deflation rate, Blockchain.News reported.

Similar sentiments were shared by market analyst Lark Davis who opined that the merge would trigger a supply growth rate of -2.8% in the Ethereum network.

With Ethereum researcher Justin Drake recently disclosed that the merge is expected to work in August because testing was in the final stages, it remains to be seen how things shape up in the ETH ecosystem.

Buying Pressure Builds up on Ethereum Network, Pushing Price Above $1,300 Amid Merge News

Ethereum (ETH) experienced notable momentum that drove the price above $1,300 after news of the much-anticipated merge made the airwaves.

The second-largest cryptocurrency based on market cap was up by 13.35% in the last 24 hours to hit $1,358 during intraday trading, according to CoinMarketCap.

The merge is expected to transition the Ethereum network to a proof-of-stake (PoS) consensus mechanism from the current proof-of-work (PoS) framework, which has been elusive for a few years.

Previously, Ethereum researcher Justin Drake revealed that the merge was likely to happen in August because testing was in the final round.

Nevertheless, during a recent developers’ call, September 19 emerged as the most probable date for the transition. It was stipulated:

“Merge two weeks later (Sept 19th).”

An Ethereum Beacon Chain community health consultant, however, hinted that the merge date was not final and said:

“This merge timeline isn’t final, but it’s extremely exciting to see it coming together. Please regard this as a planning timeline and look out for official announcements.”

Therefore, this news made the ETH market rally powerfully. On-chain insight provider Glassnode explained:

“Ethereum markets have rallied strongly off the back of a large short squeeze in futures markets. Over $98M in short futures positions were liquidated in one hour, pushing ETH prices up by 12.5%.”

Source:Glassnode

The merge is estimated to be the biggest software upgrade in the Ethereum ecosystem because the PoS algorithm will allow the confirmation of blocks in a more energy-efficient way. Therefore, validators are required to stake Ether instead of solving a cryptographic puzzle.

A DeFi educator under the pseudonym Korpi recently opined that the merge would be a game-changer because it would shift the selling pressure experienced in the Ethereum network. After all, structural supply will change to structural buying.

Ethereum Hits a Monthly High above $1,500, Merging Events Continues Engulfing the Market

Ethereum (ETH) returned to levels last seen in June based on renewed momentum following those upcoming potential merging events.

Market insight provider Santiment explained:

“Ethereum’s return above $1,500 for the first time since June 12th appears to be happening as the crowd has little belief in this rebound. Despite this, the average ETH return of 30-day traders has ballooned to +28%, the highest since August 2021.”

Source: Santiment

The 30-day return for Ethereum traders also hit an 11-month high, suggesting that the renewed momentum has driven their profits to levels last seen in August 2021.

Furthermore, ETH supply in profit also soared by 56%. On-chain insight provider Glassnode stated:

“Over the last month, almost 7.8% of circulating supply of ETH has transacted on-chain and changed hands. The total ETH supply in profit has now increased to 56%, after hitting lows of 41% prior to the current price rally.”

Source: Glassnode

The second-largest cryptocurrency was up by 3.8% to hit $1,511 during intraday trading, according to CoinMarketCap.

During a recent developers’ call, September 19 emerged as the most probable date for the merge.

Therefore, these upcoming events have been making airwaves, triggering a bullish momentum in the Ethereum market because the merge is anticipated to be the biggest software upgrade in the ecosystem.

The merge is expected to transform the Ethereum network to a proof-of-stake (PoS) consensus mechanism from the current proof-of-work (PoS) framework, which has been elusive for a few years.

The PoS algorithm will enable the confirmation of blocks in a more cost-efficient and environmentally friendly way because validators will stake Ether instead of solving a cryptographic puzzle.

Ethereum Hits 6-Week High amid Addresses in Profitability Surging

Ethereum (ETH) reached highs of $1,770, a scenario has last seen on June 10 as more momentum continues trickling into the network.

Market insight provider Santiment pointed out:

“Ethereum had a big Thursday, soaring above $1,770 for the first time since June 10th. This spike was just two days after ETH hinted at a big move following its AllTimeHigh in address activity, breaking over 1 million for the first time in history.”

Source: Santiment

Even though Ethereum had retraced to $1,715 during intraday trading, the second-largest cryptocurrency continues to enjoy an uptick in address activities.

For instance, the number of non-zero addresses has been scaling heights. Crypto analytic firm Glassnode explained:

“The number of non-zero ETH addresses just reached an ATH of 84,626,207.”

Source: Glassnode

This suggests that more participants are joining the Ethereum network, given that daily active addresses recently reached historic highs, Blockchain.News reported.

On the other hand, the bullish momentum ETH undergoing has triggered increases in profits to reach a monthly high. Glassnode noted:

“The number of Ethereum addresses in profit (7d MA) just reached a 1-month high of 47,590,069.435. Previous 1-month high of 47,585,913.821 was observed on 25 July 2022.”

Source: Glassnode

An uptick in address activity coupled with the recent merge news seems to have triggered the current upward trend in the Ethereum ecosystem.

During a recent developers’ call, the most probable date for the merge was announced as September 19.

The merge is expected to transform the Ethereum network into a proof-of-stake (PoS) consensus mechanism from the current proof-of-work (PoW) framework, which has been elusive for a few years.

Citi Believes The Merge Will Make Ethereum a “Yield-Bearing Asset”

Citigroup Inc. or Citi, an American multinational investment bank, disclosed that the merge would make Ethereum (ETH) a deflationary asset.

As a result, the second-largest cryptocurrency will become a “yield-bearing asset.”

The transition from a proof-of-work (PoW) to a proof-of-stake (PoS) consensus mechanism called the merge is speculated to be the biggest software upgrade in the Ethereum ecosystem.

Citi’s research report pointed out that the merge would slash the overall Ether issuance by 4.2% annually, making it deflationary. Therefore, shifting to a PoS consensus mechanism would enhance Ethereum’s quest to become a store of value.

Crypto service provider LuckyHash had previously shared similar sentiments by noting that the merge would prompt a 1% annual deflation rate, Blockchain.News reported.

Market analyst Lark Davis was of a similar opinion that a PoS framework would trigger a supply growth rate of -2.8% in the Ethereum network.

By becoming a “yield-bearing asset,” Citi stated that Ethereum would experience more cash flows. As a result, prompt more valuation methods that were not available before.

The report noted:

“Because Ethereum will be both yield-bearing and deflationary, it is less likely to be the blockchain with the highest throughput. Given its “enhanced store-of-value properties,” it is more likely to be where a growing amount of total value locked is secured and transacted.”

In the post-merge era, Citi expects ETH to be more environmentally friendly and energy-efficient. Moreover, Ethereum might experience a scalable future through sharding.

During a recent developers’ call, September 19 emerged as the most probable date for the merge.

Meanwhile, a DeFi educator under the pseudonym Korpi opined that the merge would be a game-changer because it would shift the selling pressure experienced in the Ethereum network

Ethereum Founder Vitalik Buterin Speculates the Merge Will Happen on September 15

Vitalik Buterin, Ethereum’s co-founder, has hinted that the much-anticipated merge might occur around September 15.

The transition from a proof-of-work (PoW) to a proof-of-stake (PoS) consensus mechanism called the merge is speculated to be the biggest software upgrade in the Ethereum ecosystem. Nevertheless, it has been quite elusive since it was launched in December 2020.

Despite these revelations by Buterin, ETH developers are anticipated to come up with a conclusive date next week, given that the final test called Goerli was finalized earlier this week.

A recent developers’ call had suggested September 19 as the most probable date for the merge.

Once the merge rolls out, the PoS algorithm will enable the confirmation of blocks in a more cost-efficient and environmentally friendly way because validators will stake Ether instead of solving a cryptographic puzzle.

Meanwhile, American multinational investment bank Citigroup or Citi recently disclosed that transitioning to a PoS consensus mechanism would make Ethereum a deflationary asset.

As a result, the second-largest cryptocurrency would become a “yield-bearing asset.”

Citi also pointed out that the merge would slash the overall Ether issuance by 4.2% annually, making it deflationary. Therefore, shifting to a PoS consensus mechanism would enhance Ethereum’s quest to become a store of value.

Therefore, as a “yield-bearing asset,” Citi added that ETH would experience more cash flows. As a result, prompting more valuation methods that were not available before.

On the other hand, Buterin recently acknowledged that MakerDAO’s consideration to depeg its native token DAI from stablecoin USD Coin (USDC) was a risky and terrible idea, Blockchain.News reported.

This decision might have been reached based on tornado sanctions because MakerDAO intends to replace USDC as collateral with Ethereum.