Is Ethereum Merge, the biggest blockchain upgrade, priced in?
The biggest blockchain upgrade — the Ethereum Merge — is expected to arrive in three weeks ~September 15, with significant implications on $ETH’s price. It’s been tested on three test networks, and next up, the upgrade on the main network.
Is the Merge priced in?
We’ve already covered its potential impact on $ETH’s price here and here. Today, we look at whether the Merge is priced in.
What does it mean to be “priced in”? Here’s an example:
- If investors expect a company to report strong earnings, they’ll buy in before the earnings date — “pricing in” the event.
- If the earnings are as expected, the stock shouldn’t move as much since investors already bought the “priced in” stock.
Ethereum is up 80%+ from its June bottom, but most assets have also gone up with signs of slowing inflation.
With the broad market viewing the Merge as bullish on $ETH’s already rising price, is the event already priced in?
1/ How many actually expect the Merge to occur? Many investors have been skeptical about the September Merge date — with the upgrade being constantly delayed for nearly six years.
2/ How much buying will come from mainstream media coverage? If not all investors believe the Merge will happen, how much FOMO buying will there be as we approach the date? A better question is how much institutional capital is waiting on the sidelines.
Ethereum’s co-founder Vitalik Buterin said in a July 27 Bankless interview that the Merge isn’t priced in and won’t be until after it happens. A fair share of investors are likely worried about the risks (covered below) and won’t be entering until after it happens.
Investors: No shortage of Merge bulls
Director of Research at Arca, Katie Talati, thinks, “this is an event that a lot of people are undercounting, especially based on current price appreciation” (CoinDesk). Her bullish view is widely shared in the industry.
Ex-Morgan Stanley associate Hal Press has raised a $30M crypto hedge fund “almost solely” investing in Ethereum’s Merge. In this in-depth interview with Bankless, Press shares his thoughts on whether the Merge is priced in.