Professional traders are a bit skeptical of Ethereum rally strength after ETH price sold off at $2,000 resistance.
Ethereum (ETH) rejected the $2,000 resistance on August 14, but a solid 82.8% gain since the rising wedge formation that began on July 13 definitely seems like a win for the bulls. The dream of “ultrasound money” is getting closer as the network is scheduled to go into The Merge on September 16.
Some critics point out that the transition away from proof-of-work (PoW) mining has been delayed for years, and that Merge itself does not solve the scalability problem. The network transition to parallel processing (sharding) is expected to happen in late 2023 or early 2024.
For Ether bulls, the EIP-1559 burning mechanism introduced in August 2021 is essential to driving ETH to scarcity, as crypto analyst and influencer Kris Kay says :
The highly anticipated move to Beacon Chain has received a lot of criticism, despite removing the need for energy-intensive mining operations. Below, “DrBitcoinMD” highlights the inability of ETH validators to withdraw their funds, creating an unsustainable temporary drop.
Without a doubt, the decrease in the number of coins available for sale has caused a supply shock, especially after the 82.8% rally experienced by Ether recently. However, these investors know the risks of staking ETH 2.0 and no promises are made about immediate withdrawals after The Merge.
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