Merger 'nerves' lead to outflows from Ethereum investment products

Institutional investors may be vacillating ahead of the ethereum merger, with $61.6 million in outflows from ethereum-based digital asset investment products suggesting concerns about the success of the upgrade.

Fund management firm CoinShares reported in its Digital Asset Fund Flows weekly report that ethereum investment products accounted for the majority of total outflows during the week of Sept. 5-11, leading to the market’s fifth consecutive week of outflows.

The outflows came "despite increased certainty about the merger," report author James Butterfill said, possibly underscoring investor concerns that "events may not go as planned," referring to the upcoming September The Ethereum merger that took place on the 15th.

Although the odds of a successful merger have improved over the past week, on September 6 the Bellatrix upgrade passed relatively unscathed .

According to ethereum node data aggregator Ethernodes, 84.6% of ethereum nodes are also now “ready to merge,” up 15.1% from last week’s 73.5% “ready to merge” rate .

Butterfill also pointed out that CoinShares has previously stated that there are unlikely to be any problems with the Ethereum upgrade because the technical specifications of the hard fork have been rigorously tested.

Meanwhile, there is still no consensus on whether the Ethereum merger has already been priced into the ETH price ($1688 as of this writing), and whether the merger will be a “buy the rumour, sell the confirmation” event.

Polygon chief security officer Mudit Gupta believes that the Ethereum merger has been priced into the price of ETH because the merger itself is "public knowledge."

On the other hand, an encryption researcher named "punk4936" on Twitter believes that after the merger, ETH issuance will be reduced by 99%, and energy efficiency will be increased by 99.9%, which is not reflected in the current ETH price.

According to Blocknative, the Ethereum merger will see the network’s consensus mechanism transition from Proof-of-Work (PoW) to Proof-of-Stake (PoS), and is scheduled to go into effect around 3:20AM UTC on September 15.