Crypto

ETH Whales Move Assets to Exchanges Pending Update

ETH whales are on the alert – large investors have begun sending their assets to exchanges in anticipation of network upgrades, according to Santiment.

The countdown has begun to the main event of this fall – the update, or merger of Ethereum, in which the network will move from the Proof-of-Work consensus algorithm to Proof-of-Stake. The Ethereum move is expected to take place between September 10 and 20.

The update that blockchain enthusiasts have been waiting for years has positively affected the price of the second largest cryptocurrency in the world. Since the Ethereum 2.0 release date was announced on July 15, the network’s native token has risen by 70%, according to TradingView, despite the correction seen in the crypto market in recent weeks.

However, whales can negatively affect the value of ETH. According to analytics firm Santiment, the largest Ethereum cold wallets have reduced their holdings of ETH by 11% in recent months, deciding to transfer assets to exchanges.

More often than not, sending crypto to exchanges is a bad sign, as it indicates that large investors want to sell or exchange assets (which they transfer to exchanges) for other cryptocurrencies.

ETH whales and demand

Despite the whale threat, overall demand for ETH continues to be a bullish indicator. The CryptoQuant analyst emphasized that the cryptocurrency is currently in the highest demand in the market.

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In August, Ethereum accounted for 40% of the total trading volume in the cryptocurrency market, while BTC rose in price by about 30%. Thus, the news about the upcoming update continues to increase the value of the asset, despite the price correction that the crypto market has suffered in recent days.

Security measures ahead of the update

Binance recently announced that it will suspend withdrawals and deposits during the Ethereum upgrade as a security measure. Users of the largest exchange in terms of trading volume will not be able to deposit or withdraw ERC-20 tokens on September 6th. On this day, the upgrade will take place at the Bellatrix consensus level, the first step towards ETH 2.0.

Withdrawal and deposit of funds will also be suspended on September 14, because the Paris update is scheduled for this day.

Other activities related to ETH and the rest of the ERC-20 tokens, such as spot and futures trading, will continue to function unchanged during the upgrade.

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