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CoinDCX's Ethereum Merge analysis: ETH trading volume up 16% in 24 hrs, 32% rise in a week

CoinDCX's Ethereum Merge analysis: ETH trading volume up 16% in 24 hrs, 32% rise in a week

After the Merge Ethereum’s issuance rate is expected to decline by ~90 per cent, with staking rewards becoming the main driver of ETH issuance.

Ethereum Merge analysis: ETH trading volume up 16% in 24 hours, 32% rise in a week Ethereum Merge analysis: ETH trading volume up 16% in 24 hours, 32% rise in a week

The overhaul of Ethereum, also known as the Merge, has finally happened. With this overhaul, the open-source blockchain has moved the digital machinery at the core of the second-largest cryptocurrency by market value to a vastly more energy-efficient system after years of development and delay.

According to CoinDCX Research Team, this overhaul swapped out one way of running a blockchain, known as proof-of-work, for another, called proof-of-stake. Following this, Ethereum should now consume 99.9 per cent or so less energy.

According to Ethereum's developers, the upgrade will make the network – which houses a $60 billion ecosystem of cryptocurrency exchanges, lending companies, non-fungible token (NFT) marketplaces and other apps – more secure and scalable.

However, Contrary to popular belief, Ethereum isn’t going to be scalable right after the merge with the transaction speed and finality only reduced marginally. Ethereum plans to combat network congestion and consequently high network fees primarily through Optimistic and Zero-Knowledge Roll-ups which constitute the “Surge” part of Ethereum’s roadmap to improve scalability.

As per ETH Merge analysis shared by CoinDCX’s research team:

  • Ethereum trading volume increased 16 per cent in the last 24 hours and witnessed a 32 per cent rise in a week.
  • After the Merge Ethereum’s issuance rate is expected to decline by ~90 per cent, with staking rewards becoming the main driver of ETH issuance.

Funding rates turned positive immediately after the merge:

  • Prior to the Merge, ETH had consistently nominal negative funding rates which reached a value of -0.6% ; which was the most negative in the last 6 months. Negative funding increases when shorts in the markets are higher than longs, which in turn were closed after the successful merge when funding rates became slightly positive again
  • The total number of Ethereum staked for ETH2.0 is 13.6 million ETH corresponding to 11 per cent of the circulating supply.
  • 426,000 validators are now running the ETH Proof of Stake (PoS) consensus mechanism and will be securing the ETH 2.0 economy.