As the September Merge update approaches, Ethereum is in a strange situation, as investors are not yet ready to invest in the network ahead of the fundamental change, given that it is not yet known what kind of effect the switch to PoW will have on the core network.
The massive inflows to the centralized exchanges are one of the main indicators of high fear among investors who are moving their holdings to the exchanges to sell their ETH as soon as they can if something doesn’t go as planned for the new version of Ethereum.
📊 As #Ethereum traders await the September proof-of-stake consensus mechanism transition, there are still hints as to where we go between now & then. Negative sentiment & $ETH shifting to exchanges are a couple things to check out in our latest insight! https://t.co/uOF7h58P3X pic.twitter.com/4RramKIVpW
– Santiment (@santimentfeed) July 26, 2022
Despite the insecurity of some market players, many Ethereum test environments have received the update and have not encountered any technical problems. The only thing investors should be concerned about at this point is the unpredictable reaction of the crypto-currency market.
Fortunately, the market reacted more than positively to the revelation of the exact date when the Merge update for Ethereum will go live, as the second largest crypto currency on the market has seen a massive 60% price increase over the past two weeks.
Unfortunately, the “rally of the revelation“was not supported by large individual and institutional investors, which is why Ether is back below $1,500.
What are the other indicators saying?
While the number of ETH on centralized exchanges is growing exponentially, other indicators show that sentiment around crypto-currency is not doing well given the overall situation in the digital asset market.
Moreover, trader sentiment dropped even lower after the market failed to push the price of crypto-currency back above the $2,000 level reached in May. For now, the majority of participants are not expecting anything out of the ordinary from the second largest crypto-currency until the fundamental update goes live.