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ETH whales are on the move. Major investors in the Ethereum (ETH) network are sending their holdings in the asset to exchange addresses, according to data gathered by Santiment.
The Merge, an event where the ETH mainnet will merge with the Beacon Chain and adopt the Proof-of-Stake (PoS) method as consensus, has entered the countdown. This comes after the Ethereum Foundation confirmed that the event should take place between the 10th and 20th of September.
The merger, awaited for years by network enthusiasts, has positively impacted the price of the second largest cryptocurrency in the world. Since the Ethereum 2.0 date was announced on July 15th, the network’s native token has surged 70% according to TradingView, despite undergoing a price correction in recent weeks.
However, this uptrend could quickly reverse due to movements made by the whales. Data from analytics firm Santiment shows that major Ethereum cold wallets have reduced their ETH holdings by 11% in recent months. They have done this by moving their cryptocurrencies to exchange addresses.
In theory, sending large amounts of an asset to exchanges is seen as a negative, as it indicates that large investors want to sell or exchange these tokens for other cryptocurrencies. In this case, this could increase the selling pressure of ETH, causing its price to drop considerably.
ETH Whales and Demand
If, on the one hand, the movement of whales can cause the price of ETH to fall, the general demand for the asset continues to be a bullish indicator. A CryptoQuant analyst highlighted that the cryptocurrency currently has the highest demand on the market.
In August, Ethereum accounted for 40% of all trading volume in the cryptocurrency market, while BTC snapped up around 30%. In this way, The Merge continues to boost the asset, despite the price corrections that the crypto market suffered in recent days.
Binance will suspend withdrawals and deposits during the merger. In a statement, Binance announced that security measures will be taken in relation to The Merge. Users of the world’s largest exchange in terms of trading volume will be unable to deposit or withdraw ERC-20 tokens on September 6.
On this day, the merger will be updated in the Bellatrix consensus layer, which will mark the initial step towards ETH 2.0.
On September 14, the date set for the Paris execution layer update, withdrawals and deposits will be suspended also.
Despite the shutdowns, other activities involving ETH and other ERC-20 tokens such as spot and futures trading will continue to function unchanged during The Merge.
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Anderson Mendes
Anderson serves as a writer for BeInCrypto, covering news about the cryptomarket and the economy in general. He has also participated in projects related to crypto trading, news production and educational content. With a degree in Administration, he is currently pursuing a postgraduate degree in Investments and Blockchain at the EA Banking School.
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