Institutional investors may be on the fence about the Ethereum Merge because Ether-based digital asset investment products lost $61.6 million, which shows that they are worried about how well the upgrade will work.
In its weekly report on digital asset fund flows, fund manager CoinShares said that Ether-based investment products made up most of the total outflows during the week of September 5-11. This was the fifth week in a row that the market lost money.
Related: The Ethereum blockchain will get a big update to cut down on energy use.
The report’s author, James Butterfill, said that the outflows happened “despite the improved certainty of the Merge.” This could mean that investors are worried that the upcoming Ethereum Merge, which is set to happen on September 15, “might not go as planned.”
Even though the chances of a successful merge have been getting better over the past week and the Bellatrix upgrade went through with few problems on September 6, this is still the case.
Ethernodes, which collects data from Ethereum nodes, says that 84.6% of them are now “Merge ready.” This is 15.1% more than last week, when only 73.5% of nodes were “merge ready.”
Butterfill also said that CoinShares has said in the past that the Ethereum upgrade is unlikely to cause problems because the technical details of the hard fork have been thoroughly tested.
After 11 weeks of outflows, institutions start to feel better about ETH.
At the same time, there is still no agreement on whether or not the Ethereum Merge has been factored into the current price of ETH, which is $1,688, and whether or not the Merge will be a “buy the rumour, sell the news” event.
Mudit Gupta, the Chief Security Officer at Polygon, thinks that the Ethereum Merge has been priced into ETH because the Merge itself is “public knowledge.”
If it’s common knowledge, the price already takes it into account.
Related: Uniglo (GLO) is jumping right into the Ethereum (ETH) merge, free Bitcoin (BTC) trading on Binance (BNB), and a new bull market.
If the information isn’t known to the public, it’s insider trading.
Don’t get rekt while gambling.
— Mudit Gupta (@Mudit Gupta) September 7, 2022
On the other hand, a crypto researcher on Twitter named “punk4936” thinks that the current price of ETH doesn’t reflect the fact that the Merge cut the amount of ETH issued by 99% and made the network 99.9% more energy efficient.
Ethereum is about to cut its supply by 99% and use 99.9% less energy. The merge has not yet been priced in.
4936 (@punk4936) September 7, 2022
The Ethereum Merge will change the network’s consensus mechanism from proof-of-work (PoW) to proof-of-stake (PoS). According to Blocknative, this change will happen on September 15 at about 3:20 am UTC.