BitMEX Founder Advises Crypto Traders to Get Ready to Buy ETH DipAugust 18, 2022
BitMEX Founder and its former CEO, Arthur Hayes has said Ethereum is likely to go through a correction in a matter of weeks. Hayes said the result of its coming Merge notwithstanding.
ETH Price Might Just Drop Sharply
Hayes stated via a recently published blog post that Ethereum could see a steep price drop if the expected Merge becomes unsuccessful. He said an unsuccessful Merge will lead to a vicious and quick dump because of the market’s huge expectations against the actual reality.
He stated further that the relationship between the amount of currency deflation and the price will be negatively reflexive. Viewing it from another perspective will mean that the relationship between the degree of currency inflation and the price will have a positive reflex.
Hayes said that given that case, he thinks traders would rather have less ETH or not have it at all. The relationship, however, has a floor. It is a fact that the Ethereum network is the oldest decentralized network in operation.
Ethereum secured a huge market capitalization without the narrative of a merger. Most of the popular decentralized apps were built on Ethereum, and the network has the most number of developers than any other L1 chain.
If the given scenario plays out, Hayes said he sees Ethereum falling as low as $800 to $1,000. The asset is currently selling at $1,847. It means Ethereum has lost 3% of its price over the last 24 hours.
Race to the Merge
The final merger to ETH 2.0 is now expected to be completed on the 15th of September. It will let the Ethereum mainnet be merged with the platform’s Beacon Chain. The move will translate Ethereum from operating on a proof-of-work consensus to a proof-of-stake consensus.
The network upgrade is aimed at fixing the scalability problems Ethereum has. It will then prepare the groundwork for more upgrades in the future.
On another hand, Hayes said if the upgrade is successful, it will give more impetus to the asset’s rally. Although there are possibilities that it might not be an immediate effect.
He said any structural reduction in terms of inflation will come up after the Merge. It is possible that we see something like when Bitcoin halves. Everyone knows when it will occur but Bitcoin just rallies after halving at all times.
It is then possible that the price of Ethereum drops just a little bit following the Merge.