The Biggest Crypto Catalyst Since the Bitcoin Halving: The Ethereum Merge
Ethereum 2.0: The Merge | Market Update | Newswatch
Ouch! The markets are bleeding red as the newest inflation numbers are set to release. Will they be high again? Obviously. But not all is lost; one of the most significant events in crypto history is months away. Allegedly.
All that and more!
TL;DR
Ethereum 2.0: The Merge
Gripping price action in ETH/BTC chart
Uniswap branches out
NFTs: BAYC film?
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The Ethereum Merge: The most significant bull catalyst since the bitcoin halving
The markets have been seeing mixed action since the FED began cutting rates and lowering its balance sheet, but there's a significant catalyst dead ahead, one that may be as significant as the bitcoin halving.
Bitcoin halvings historically occur before major crypto bull runs. There's a major reason for that: the market feels it when you cut the supply issuance of the largest crypto asset in half.
When bitcoin initiated its latest halving event in May 2020, the market cap network sat at $US166b. But this summary isn't about bitcoin. Instead, it's about Ethereum's upcoming Merge and bullish updates to the chain.
Ethereum's current market cap is more than twice as large as bitcoin's in 2020, and Ethereum is about to incur the equivalent of three issuances halvings in one instance.
Ethereum updates have historically been slow (and often delayed). Still, things look promising this time around, and the devs are moving along steadily, with the merge date not far from being announced.
So what's the big deal? What happens when the home of DeFi, 55% of all Total Value Locked (TVL), and some 5000-plus tokens merges to its proof of Stake mainnet?
No more miners as the chain moves to a Proof Of Work (PoS) consensus.
No more miners equal less selling pressure because validators are cheaper to run than mining equipment and electricity needs.
ETH Staking on Ethereum validators at the 8-11% APY rate. Higher APY means more reason to own and stake ETH.
ETH issuance will reduce by 90% percent because the network will be cheaper to secure. With the EIP-1559 update, the network now burns ETH used as gas. As a result, the demand vs. issuance structure will flip, and ETH will become a deflationary token.
Ethereum becomes environmentally friendly; ESG compatible.
Imagine three halvings in one, plus some added benefits like a sweet 8-11% staking APY. The issuance reduction will dissipate millions of dollars worth of daily sell pressure in ETH from miners. Moreover, when Ethereum becomes environmentally friendly, companies will be able to invest in ETH without the ESG mandate pressure.
So if you believe in Ethereum and its devs, The Merge might be the most prominent catalyst crypto has seen since Satoshi rolled out the bitcoin network in 2009.
Market update 🌍
All major markets felt the loom of today’s CPI number, but crypto significantly felt the sting. Bitcoin (BTC) fell below $US40,000 for the first time in nearly a month and has come in contact with the uptrend mark (blue) that, if broken, could signal further trouble. BTC finished the US session down -6.30% to $US39,500k.
Source: Trading View
The ETHBTC chart showed gripping price action near the close of the US trading session as traders aggressively exited BTC in favor of ETH- just noise, or did traders see the opportunity to enter ETH ahead of the Merge.
Source: Trading View
Newswatch 📰
Uniswap branches out. Uniswap Labs, the team behind decentralized exchange (DEX) Uniswap (UNI), has deployed a venture unit for the first time and looks to invest in startup projects focused on web3. In addition, the team looks to leverage experience from successfully developing and deploying Uniswap to aid future partners.
Mastercard meta. Mastercard has filed 15 metaverse-related trademark applications that point towards the company pivoting to a payments system for metaverses. Virtual cards, marketplaces, and NFTs were all included in the trademark applications.
On-chain ⛓
Fleeing digital assets. After the largest month of capital inflows to digital asset funds in 2022, Coinshares reports $US -131m in BTC outflows, the largest outflow since January. Similarly, Ethereum saw $US -15m in outflows.
NFT & metaverse update 🐵
Fortnite Metaverse anyone? Epic Games, the creator of the popular game Fortnite, raised $US2b from Sony and the Lego Family to fund its move into the metaverse. Epic Games and Lego announced a partnership last week intending to create a 'family-friendly" metaverse.
Bored Apes Films. Some Ape owners will have another means of profit after Coinbase announces the production of a three-part series titled "The Dengen Trilogy" based on the BAYC NFT project. The film will show during the NFT.NYC conference on June 20-23.
Notable Mints:
Writer’s take
Easy come, easy go. As the Fed begins to pull the lifelines in response to rising inflation, markets are getting tighter and tighter. Additionally, tax season isn't helping prices. Today's CPI print will garner more information even though many predict another high number. But not all is gloom and doom. There is some light on the horizon in the form of the Ethereum Merge. One of the most critical events in crypto's short history is likely only months away, and if the market reacts as it does to bitcoin halvings, we better buckle up and hold on tightly.