Ethereum NTF Merge- ethereum merge

This week, news of the Ethereum Merge has been spreading across the market. Yesterday, Ethereum developers declared September 15 -16 as the official date for the Merge. The report has been stirring action for several crypto assets. The developments surrounding the Merge seem to heighten derivatives activities as more traders bet on Ether (ETH).

Traders bet on Ether ahead of the Merge

This week’s on-chain report by Glassnode revealed that traders were utilizing call options to bet on Ether’s price movement. Moreover, the gap in futures on options shows that some traders are ready to sell the news.

Derivative traders seem to be placing obvious bets on Ether concerning the upcoming Merge that now has an official date of September 15 -16. Ethereum options open interest hit $6.8 billion, notably higher than Bitcoin’s $4.8 billion. It is the first time in history that Ethereum options open interest has surpassed Bitcoin’s

Despite the milestone, the Ether options open interest is yet to reclaim the all-time high. The contracts on Deribit in September prove that there was a directional bias of Ethereum traders. The call options are notably less than the put options for size, and the traders are now betting on Ether prices to gain past $2200. The open interest is also expected to reach $5000.

On the other hand, the Merge news is not a certainty that more traders will continue to buy Ethereum. The pain price for Ether is currently at $1350, which would contribute to the maximum number of options running out of money.

Glassnode also said there was a significantly lower demand for Ether exposure through options after the Merge. The post-Merge data hints that there could be higher volatility, indicating that traders are paying for a sell-the-news put option after the Merge.

This data by Glassnode shows that Ethereum traders hold a long bias because of the Merge news, as shown in the high number of options contracts dated September. After September, the futures and options market is in backwardation, showing that the Merge could be just a “buy the rumor, sell the news” event.

The Ethereum Merge

Yesterday, Ethereum developers confirmed that the Ethereum Merge would happen on September 15 – 16. The date was provided through a Consensus Layer Call. Ethereum’s core developer, Tim Beiko, also confirmed the news saying that the targeted Total Terminal Difficulty is 58,750,000,000,000,000,000,000.

After the TTD hits the difficulty level needed to mine the final Ethereum block, the network will transition from a proof-of-work consensus to a proof-of-stake consensus. The Bellatrix upgrade will be released on September 6, after which the second part of the Merge dubbed “Paris” will go live at the stipulated TTD. This will happen between September 15 and September 16.

However, the date could also change if there are any issues. Nevertheless, this is the clearest schedule that Ethereum has provided as to when the Merge will occur. The Merge is highly anticipated as it will be one of the most critical events in crypto.