Smart money is accumulating Ethereum even as traders warn of a drop to $2.4K

The Ethereum merger is a hot topic in crypto. Analysts have many perspectives on how the transition from proof of stake to Ethereum could affect Ether’s price.

ETH/USDT 1-day chart. Source: TradingView

The whales are ahead of the merger

Jarvis Labs, a cryptocurrency intelligence firm, provided a deeper dive into Ether’s ongoing accumulation by whale wallets. The following chart shows the percentage change in whale wallet holdings relative to ET price.

Source: Twitter. Source: Twitter

The Ether price is represented by the color of the dots. This chart shows that whale wallets started to lose their Ether holdings at $4,000, and didn’t reaccumulate until the price fell below $2,300.

Jarvis Labs stated,

“Whales are continuing to accumulate Ether, their accumulation remains in sideways-to-uptrend.”

It’s not only the whales that are trying to grab Ether on the dip. As shown in the chart below, where the red dots indicate that both smaller wallets as well as whale wallets have experienced an increase in accumulation.

Divergence. Source: Twitter

Jarvis Labs analysts said:

“Looking at the Ether wallet distributions only, it is possible to infer that Whales + Fishes Up (Both Whales and Fishes seem like they are accumulating). Merge narrative?”

Are there plans for an Ethereum decoupling?

Delphi Digital analysts considered whether Ethereum could be decoupled from BTC during or after the merger. Analysts at Delphi Digital also predicted that altcoin would see “more consolidation for ETH/BTC” in the near term.

Trends in ETH/BTC prices Source: Delphi Digital

This chart asks the key question: What will it take to free Ether from the “invisible chain” that has held it tethered so long to Bitcoin?

Delphi Digital claims that the current bullish “ultrasoundmoney” and “Merge” narratives around Ether could be the right thing to help Ether get out of its correlation with Bitcoin price action.

Delphi Digital said,

“Post-Merge Ether will continue to attract interest, particularly as more people realize the potential to earn higher real yields when denominated into a deflationary asset.”

Ether staking gains momentum

Statistics on Ether Staking. Source:

Despite Ether’s declining price, data shows that the number staked on the beacon chains continues to rise. Dune Analytics data also shows an increase in deposits to Eth2; multiple analysts have offered their views on how institutional investors might trade Ether during the pre- and post Merge phases.

Lido Eth2 deposits. Source: Dune Analytics

Overall, data shows that Ether is trading at 42.5% below its all-time high. However, smart money continues to grow due to the anticipated increase in the staking reward percentage, and the anticipation that Ethereum will become a deflationary asset.

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