ETH miners have dumped 17,000 ETH in the last seven days, which could be attributed to ETH’s decline.
Ethereum is currently trading at $1,330, down 2.16% in the last 24 hours.
Several crypto analysts have weighed in on potential causes of Ethereum’s Downward trend, and the mass dumping by ETH miners topped the list.
Miners were waiting for positive price action pre merge.
The data from Oklink suggests that Ethereum miners have sold nearly 17,000 ETH in the last seven days, adding more pressure to the plunging values of Ethereum.
Ethereum Miners Offloaded 17,000 ETH In The Last Seven Days
The highly anticipated Ethereum merge failed to inflate the price of Ethereum, which is currently sitting at $1,330.67. On top of that, the selling pressure initiated by Ethereum miners is adding more fuel to the plunging value of Ethereum.
Data from Trading View indicates that the price of Ethereum has documented a steep decline since September 15. ETH was trading at $1,650 on the day of the merge and has fallen sharply since then, trading at a new low of $1.330.
Several crypto analysts have weighed in on potential causes that may have contributed to Ethereum’s downward trend, among which mass dumping of ETH by miners has topped the list. Alongside that, analysts are also considering other potential factors, including the panic selling initiated by investors ahead of the Federal Reserve’s two-day meeting, which is scheduled to be held today. Investors are anticipating a significant interest hike amid soaring inflation in August, which may be causing Ethereum to decline in value.
Among other things, the pre-merge Ethereum was capable of distributing approximately 13,000 ETH per day. However, post the merge event, the percentage of rewards to miners declined substantially, reduced by almost 90%. Validators are now accumulating only 10.6% of the previous amount. Due to this, Ethereum’s annual emissions have dropped by 0.5%, making Ethereum less inflationary.
“Many miners were awaiting positive price action from The Merge, and when that didn’t come as expected, they exited the ETH space entirely to free up capital for new ventures, “as told by Harrison Dell, director of Cadena Lega, to The Defiant.
While analysts have labelled mass dumping by miners as one of the primary causes of Ethereum’s plummeting values, the co-founder of CoinGecko, Bobby Ong, believes major macroeconomic factors are pushing ETH to new lows.
“I would say that the overall market decline, including for ETH, was due to the Federal Open Market Committee meeting taking place today. Now that the Ethereum Merge is complete, all eyes are on the FOMC meeting, which is scheduled to take place today…Markets are expecting further interest rate hikes to get inflation under control, resulting in the pre-emptive selling of risk assets like equities and crypto.” Ong reiterated (The Defiant)
On September 20, Goldman Sachs predicted that interest rates are bound to rise four times between 2022 and 2024. In addition, the two-day meeting scheduled for today could declare a potential interest hike between 4.25% and 4.5% to combat inflation, which may also compel investors to panic and sell their assets to extract maximum profits.
However, the plummeting Ethereum values are expected to stabilise with time, once the market has absorbed the selling pressure and macro-economic factors have played out to weed out weaker sections of the market.