Investors were cautious on ETH, the blockchain's native token, despite all the buzz surrounding last week's significant Ethereum makeover known as the Merge. Their prudence was rewarded as the cryptocurrency fell as a result of the event.
For the week ending September 16, investment products linked to ETH experienced outflows for the fourth consecutive week, with the amount taken out surpassing the amount put in by $15.4 million, according to CoinShares. This was not a general trend in cryptocurrency. A five-week sequence of withdrawals from funds invested in bitcoin (BTC), the greater rival to ETH, was broken when investors contributed a net $17.4 million.
Even if the risky update happened without a hitch, the price of ETH has dropped dramatically since the Merge, which was hailed as an occasion that may draw more important investors to the ecosystem. ETH was close to $1,800 five days prior to the switch taking place on September 15. Today, it fell below $1,300.
It is possible that investors who bought into ETH's uptrend before the Merge sold their positions.
The decline in spot prices was made worse by large liquidations of leveraged long positions throughout derivatives markets, according to an analysis from crypto analytics company Kaiko that sought to explain why ETH prices had dropped so sharply after the Merge.
By fLEXI tEAM