What’s next for Bitcoin and the crypto market now that the Ethereum merger is over?


The Ethereum merger came and went, forcing investors to think about what the next trending development in the market might look like. In a coin telegraph Twitter Space with Capriole Fund Founder, Charles Edwards, the analyst noted that excitement over the Ethereum merger and rising price action had somewhat held up hopes in the market. Now that the event has come and gone, the crypto market has sold out, with Bitcoin (BTC) price below $20,000 and Ether (ETH) below $1,500.

Eventually, new stories and market trends will emerge, and if the fundamentals are right, traders will rotate funds as these new leaders emerge.

Let’s take a look at some potential trends.

Where will the former ETH miners go?

The Ethereum network has successfully switched to a proof-of-stake (PoS) model, which means that miners have no money, but may still own their GPUs and ASICs mining infrastructure. It is possible that some miners choose to mine on a different chain instead of selling their equipment.

While they haven’t chosen a specific chain yet, Ravencoin, Flux, Ethereum Classic, and Ergo appear to be the frontrunners. Leading up to the Merge, each network saw its hash rate rise to new all-time highs, as shown below.

ETC hashrate. Source: 2Miners
VERY hash rate. Source: 2Miners
RVN hashrate. Source: 2Miners
FLUX hashrate. Source: 2Miners

The prices of each altcoin also rose in the past month, with Ravencoin’s RVN up 169%, Ergo’s ERG up 132%, Flux up 156% and Ethereum Classic’s ETC up 135% over the past 90 days.

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Interestingly, the hash rate and price fell sharply on Sept. 15, and at the time of writing, only Flux and RVN appear to be recovering. The coming weeks and months will be interesting to see which network miners might choose as their new home and the impact this has on the cryptocurrency’s price.

The Cosmos continues to expand

The Cosmos ecosystem continues to expand, which seems to be attracting buyers to ATOM. Since bottoming out at $5.50 on June 18, ATOM’s price is up 137.5% and is currently trading above $16. Analysis suggests that investors generally view the soon-to-be-launched liquid staking, ATOM being used as collateral to TBEN stablecoin, the launch of Cosmos Hub 2.0, and the eventual recovery of decentralized funding as bullish long-term factors for ATOM price.

Buy the rumor and sell the news, or buy the dip?

While ETH’s current price action is less bullish than Merge supporters and ETH bulls had hoped, the actual shift to PoS appears to have been a success, and perhaps the benefits of PoS will translate into bullish ETH price action over time . According to Ben Lilly, co-founder of Jarvis Labs, the “Joe Cool move” for ETH investors is not to “get caught up in the coming days. The main player likely to do a crazy activity is that of the miner. And that is a one-time event that will be short-lived.”

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Lilly explained that:

“Joe Cool’s move is to sit there and buy any kind of over-emotional movement. Then sit back and take it easy.”

Going forward, Ether could experience a supply shock and potentially become deflationary. Staking further secures the network while providing a guaranteed return on deposited assets. In a market that is stuck in a downtrend, it may become more attractive to buy a safe, predictable yield.

Essentially, Lilly is suggesting that it will take some time for the fervor surrounding the merger to settle down and investors to begin to reap the benefits that the PoS Ethereum network could provide.

What about Bitcoin?

In this week’s Bitcoin analysis, I discussed that not much has changed with the price of Bitcoin. The price has stayed in the $17,600-$24,400 range for the past three months, and any out-of-range gains high since March 29 have been capped by the 200-day moving average and an overhead resistance trendline extending from Bitcoin’s November 2021 highest. point ever at $69,400.

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BTC/USDT 1-day chart. Source: TradingView

While continued consolidation within the current range could (and would be) good for altcoins, macro tensions could continue to weigh on crypto and stock markets. The hot September 12 consumer price index could lead to more aggressive rate hikes by the US Federal Reserve, and the potential knock-on effect on stock prices could have an even sharper spillover effect on crypto prices.

For this reason, investors remain largely risk averse to most cryptocurrencies, and it’s possible that repeated rejections at the long-term falling trendline and further retests of the $19,000 support could eventually lead to a breakdown below the annual swing low.

This newsletter is written by Big Smokey, the author of The Humble Pontificator Substack and resident newsletter author at TBEN. Every Friday, Big Smokey will write market insights, trending how-tos, analysis and early-bird research on possible emerging trends within the crypto market.

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