Ether falls down by 15% as investors grab profits and worry about rate increases.
Since the Ethereum network, the technology that underpins ether and other cryptocurrencies, underwent a significant update known as the merge, ether has declined more than bitcoin.
Blockchain technology called Ethereum makes it possible for programmers to create apps on top of it. The native coin used by Ethereum is called Ether.
The merge is an upgrade to Ethereum that changes the validation mechanism for transactions from a proof-of-work method to proof-of-stake. Proponents say this will make validating transactions on Ethereum much more energy efficient and has been eagerly-anticipated by the crypto community.
Despite the upgrade happening successfully, ether has fallen more than bitcoin.
Since Sept. 15, the date the merge was completed, to around 4:30 a.m ET on Tuesday, ether is down around 15%. Bitcoin has dropped around 3% in the same period.
Ahead of the network upgrade, the price of ether roughly doubled from the lows of the year in June, far outpacing bitcoin’s gains.
Vijay Ayyar, vice president of corporate development and international at crypto exchange Luno, said that the merge was already “priced in” for ether and the “actual event was a ‘sell the news’ situation.”
Traders are also shifting investments from ether and other alternative digital coins back into bitcoin, according to Ayyar, “since the expectation is that Bitcoin will outperform for a few months from here on.”