Cryptoverse: Ether holds its breath by leaning, which means ‘merging’

Investors of the ether and its troubled tETH expect in fear of the crypto legend: Consolidation. That is the name of the major development of the Ethereum blockchain network on which many crypto projects are built, aimed at making them thinner, softer and cleaner. It’s not easy. Consolidation was supposed to take place years ago but was delayed several times, with recent developers making plans to press a button in June, shocking investors who begin to fear that they may never see the light of day.

However, now market players are betting that the end of the wait is near. But it is not a slam dunk. At Polymarket, a crypto site where users bet on stablecoins where future events take place, investors have set a 67% chance that the upgrade, also known as Ethereum 2.0, will take place in October, and 13 chances %. September.

The Ethereum Foundation, which uses the simulation of changing a spacecraft engine during aircraft, says on its website that integration “sends” approximately “Q3 / Q4 2022”.

Consolidation of the latter event will prove a great ether release, which has decreased in the past delays and a decrease in confidence in development. The second largest cryptocurrency had traded for about $ 1,200, falling from just over $ 3,500 in April, although much of the recent uncertainty about the development is rife with recent market transactions.

The merger may also signal the end of the trial for those investors who hold a crypto exit token called staked ether or stETH, which represents the ether confined to a test site for development, and which is difficult to redeem at a rate up to at least six months. after the encounter took place.

Yet skeptics remain.

“It’s just a lot of protocol. Ethereum is so big that I don’t think they will reach their deadline on time, “said Brent Xu, founder and CEO at Umee, who built the blockchain-based lending platform.

“People are just afraid that their stETH will not gain anything because consolidation will probably take longer than expected,” Xu said.

STETH changes

The development will see the evolution of ether mines far beyond proof of energy-intensive work. The existing Ethereum assassination platform will be combined with a new system of evidence consensus.

Any further delays could be bad news for those who hold stETH, a token created by a crypto project called Lido that can be converted to ether on a 1: 1 basis between six and 12 months after the merger occurs.

Until then, stETH traded at a set price in the market, most trading took place in a trading area called Curve.

It reached a market cap of $ 11 billion in May, according to the price coin CoinGecko, and until last month was widely traded in ether.

However, when the crypto markets were fully traded last month stETH dropped its trading price by about 8% discount on ether, hampered by massive sales by investors like Celsius and Three Arrows according to public data.

The price has recovered slightly – stETH currently trading at a 4% discount on ether – but has not yet returned to equity, in part due to the impact of merger delays.

Major investors at stETH include a U.S.-based crypto lender.

Did anyone take that trade?

The stETH project was popular because while investors could earn interest elsewhere by “inserting” their ether, to do so they had to lock away a minimum of 32 ether (currently about $ 38,000) until the network progressed to a new level.

Lido, instead, allowed them to inject as little ether as they wished in order to obtain a harvest, and to obtain stETH.

Yet repeated delays in integration test the sensitivity of stETH investors.

Concerns over whether the payment will dry up quickly in Curve, said Ryan Shea, a crypto economist at the global fintech company Trakx.io. Curve’s stETH liquidity is more than half since mid-May, according to platform data.

“You will need to find other sources if you want to sell a large amount of stETH,” said Shea, as setting stETH as collateral for another borrowing process.

“But in this kind of place where people are looking at crypto lending companies, even if there is something that is ready to take that trade, I don’t know.”