Is Ethereum Merge, the biggest blockchain upgrade,  priced in? – The Average Joe


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    Is Ethereum Merge, the biggest blockchain upgrade,  priced in?


    August 24, 2022

    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?

    That depends….

    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.

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