Ethereum ($ETH) Price Could Fall Below $1,000 Before Merge, Warns Bloomberg Report

According to a recent Bloomberg report, $ETH “may drop to $1,000 for the first time in two months, with volatile price swings in the second-largest cryptocurrency ahead of its much-anticipated Merge upgrade.”

Ethereum’s upcoming “Merge” upgrade, which marks the Ethereum network’s transition from proof-of-work (PoW) to proof-of-stake (PoS), is expected to take place sometime between September 10 and September 20.

Here is how Ethereum Foundation explains the Merge:

“The Merge represents the joining of the existing execution layer of Ethereum (the Mainnet we use today) with its new proof-of-stake consensus layer, the Beacon Chain. It eliminates the need for energy-intensive mining and instead secures the network using staked ETH. A truly exciting step in realizing the Ethereum vision – more scalability, security, and sustainability.

“It’s important to remember that initially, the Beacon Chain shipped separately from Mainnet. Ethereum Mainnet – with all it’s accounts, balances, smart contracts, and blockchain state – continues to be secured by proof-of-work, even while the Beacon Chain runs in parallel using proof-of-stake. The approaching Merge is when these two systems finally come together, and proof-of-work is replaced permanently by proof-of-stake.

“Let’s consider an analogy. Imagine Ethereum is a spaceship that isn’t quite ready for an interstellar voyage. With the Beacon Chain, the community has built a new engine and a hardened hull. After significant testing, it’s almost time to hot-swap the new engine for the old mid-flight. This will merge the new, more efficient engine into the existing ship, ready to put in some serious lightyears and take on the universe.“

According to data by TradingView, on crypto exchange Bitstamp, currently (as of 2:47 a.m. UTC on August 31) ETH-USD is trading around $1599.

Per a report about $ETH published by Bloomberg on Tuesday (August 30), “technical indicators on momentum and price trends show that the token’s tumble from a peak of about $2,000 in mid-August to the current zone near $1,500 is likely to continue.”

Katie Stockton, co-founder of Fairlead Strategies, told Bloomberg that “Ether has broken down below initial support from its 50-day moving average, increasing downside risk with short-term momentum now negative… the weekly stochastics have a downturn for the first time since April,” which suggests that the $1000 support level could get retested “in the coming days.”

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Featured Image via Pixabay

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