The Ethereum community and the entire crypto space will soon witness the Merge launch, the long-awaited upgrade. It’s a transition for the Ethereum mainnet from PoW to PoS consensus mechanism. It has become one of the most hyped events in the industry as many people are presenting different opinions about it.
Over the past few weeks, sentiment on the Merge boosted the price of Ether. Despite some slight downward moves in the broader crypto market, ETH remained one of the tokens with a more impressive performance.
The sudden decline in the price of Ethereum is creating many concerns for many participants. Several people are confused about the twist in the movement of Ether since the Merge is at hand.
Furthermore, other preparatory activities and upgrades that will usher in the Merge are almost completed. Hence, investors are expecting to get more increase in the price of ETH.
Effect Of Bellatrix Upgrade on Ethereum Network
The ETH network witnessed the Bellatrix upgrade recently. The upgrade is meant to enable Ethereum validators to create Beacon blocks. One of the completed blocks will contain the code for the Merge. The Bellatrix upgrade serves as one of the upgrades that initiate the Merge.
A report on the process indicated that Ethereum witnessed a drop in its network participation rate after the Bellatrix upgrade. Also, there was a spike in missed blocks in the network.
The record showed that the rate for missed blocks after the upgrade surged by 1700%. With just a week remaining for the Merge, the Ethereum developer team is expected to watch the situation closely.
Some professionals offered reasons for the reduction in upgraded nodes. They mentioned that it could be the failure of some nodes in upgrading their clients. They stated that an increase in participation would come once more validators upgrade their nodes to sync with the Bellatrix upgrade.
Possible Reasons For Ethereum Decline
People are providing different reasons for the decline in Ethereum prices. Some factors are also playing out on the side against the broader crypto market. The Ethereum price is dwindling due to the effect of macroeconomic factors.
The wave of the dollar’s rally is throwing almost the entire crypto market and even the general market off balance. Also, the hawkish approach from the Fed in tackling inflation is expected to continue.
A partner at Cinneamhain Ventures and crypto influencer, Adam Cochran, linked the drop to Aave’s stance on Ethereum markets. The influencer noted that Aave’s halting Ethereum markets triggered other platforms like Instadapp to unwind sETH/ETH pools.
Featured image from Pixabay, chart from TradingView.com