While the market rebounded slightly, Ethereum (ETH) has gained over 5% in the last 24 hours. At the time of writing, it is trading at $1,909. Meanwhile, traders holding large short positions on Ethereum were caught off-guard by the sudden altcoin rally.
Ethereum is getting short squeeze
According to Coinglass data, $682 million worth of short positions have been liquidated in the last four hours. Most of these took place on the cryptocurrency exchange Bitfinex. In the past four hours, the exchange, which is 100 percent short on Ethereum, has witnessed over $670 million liquidation, all of which are short positions. Short liquidations on Ethereum hit the highest level in the last three years.
Leading altcoin sees largest single-day short liquidations in three years
According to CryptoQuant statistics, Ethereum has suffered the most one-day liquidation in three years as a result of Bitfinex liquidations. In the last 24 hours, almost $698 million has been liquidated, of which 99.5% is open.
The huge short volume indicates that the second largest cryptocurrency is the target of many market sentiments. Ethereum was also trading below $1700, its lowest level since July 2021. A break below this level was definitely expected to result in further declines. The anticipation of Ethereum’s upcoming transition to PoS has driven much of the recent price action.
Wednesday is the big day, Ethereum merge starts June 8
As Ethereum rises, it may consolidate its gains ahead of a critical PoS test this week, according to analysts. This week, Ropsten Testnet, one of the largest Blockchain testnet stages, will implement a PoS model. According to developer Tim Beiko, Blockchain needs to pass two more testnets before setting a date for integration. While Ethereum co-founder Vitalik Buterin claims that the merger could happen in August, Beiko’s statements may indicate a delay. However, the merger is expected to increase the value of Ethereum, with the merge the network considers expenses and becomes more accessible.
What you need to know about Ethereum merge
“Merge” makes Ethereum faster than PoW mechanism and aims to switch to a more energy efficient PoS model. Unlike proof-of-work, PoS validators do not need to dig blocks to protect the network. Instead, they must create new blocks when selected and validate others when they are not. The rewards are then distributed by the network in Ethereum proportional to each validator’s stake. This update, which has been on the agenda of the Ethereum community for quite some time, starts to be implemented with the Ropsten testnet on Wednesday, July 8th. As Kriptokoin.com we have covered the current details in this article.
