Ether, the native coin on the Ethereum blockchain, hit its lowest price in two weeks on May 6th as the news of upward adjusted interest rates hit the market. However, it did better when compared to Bitcoin, which hit a three-week low. The trend continued on Monday (9th May, 2022) morning when both cryptos further shot down, alongside other 100 altcoins.
Nonetheless, the ETH/BTC pair hit a 3-week high.
Impact of Ethereum Shift from POW to POS
Crypto experts have indicated that Ethereum’s shift from proof of work (POW) to proof of stake (POS) protocol is one of the primary reasons driving capital circulation between Ether and Bitcoin markets. Ethereum has grown by close to 250% against Bitcoin since the commencement of the migration to POS protocol in December 2020.
According to Eliezer Ndinga, the lead researcher at 21 Shares, it is possible that liquid staking is playing a huge role in slowing down the sell-side pressure.
Ethereum Overtakes Bitcoin in a Bear Run
Last week, traders of Ethereum and Bitcoin responded to the news of higher interest by selling off the assets, pushing the price to the lowest points in three weeks. Ethereum shot down to hit a low of USD 2,600 last week, but it appears that bears were not done. On Monday morning this week, the price dropped further down by 4.2% to reach an all-time low of USD 2,451.
After stabilizing around USD 36,000, Bitcoin also resumed a downtrend, losing 3.6% to reach USD 33,536 on Monday morning this week. Technical indicators suggest that both Ether and BTC might go down further in the coming weeks and months.