The Ethereum network has just experienced its first day as a Proof-of-Stake Blockchain. Unfortunately for the bulls, however, this has meant nothing for its price action, as the price of ETH has sunk below the $1500 mark.
Ethereum Price Analysis
After clinging to the $1600 level on the 15th of September, ETH slipped below 5%, right when bitcoin dipped about 2.4%, sinking below $20,000, and finally rested around $19,700.
At the time of writing, ETH is worth $1474, and Bitcoin is worth about $19,787.
Bitcoin’s drop was similar to Ethereum’s but less significant, as its market cap is now back to being more than double that of Ethereum’s.
Vitalik Buterin and many other “Ethereans” have argued that the merge is yet to be priced in. However, most Ethereum maximalists have also noted that there may be a “sell the news” scenario right after the merge.
Ethereum is currently testing the resistance at the $1444 level and may experience a bounce to the upside, taking prices back towards the $1800 – $2000 levels.
PoS Cryptocurrencies Are Security
Chairperson of the SEC, Gary Gensler, has once again aired his thoughts about cryptocurrencies. This time, he focuses on Proof-of-Stake Blockchains and their cryptocurrencies.
While Gensler didn’t mention Ethereum specifically, he noted that Proof-of-Stake cryptocurrencies qualify as investment contracts, subjecting them to securities regulations by the SEC.
According to reports from the wall street journal, Gensler explains that Proof-of-Stake blockchains (that reward investors with new coins for staking their holdings) are similar to investment contracts.
While Gensler wasn’t speaking specifically about Ethereum, the timing of his comments (that came right after Ethereum completed its move from Proof-of-Work to Proof-of-Stake) suggests that this new milestone for cryptocurrencies may carry heavier implications for the second largest blockchain in the world; minus cutting its energy consumption by more than 90%.
According to CoinDesk, Blockchain data still shows that investors send large amounts of ETH to crypto exchanges. This is often an indicator that a huge dump is incoming, minus the cumulative inflow of these ETH tokens into the exchanges is at its highest in the last six months.
