While Bitcoin dumped and pumped yesterday, Ethereum just dumped, breaking back below $1800 for the first time since May 12th…
Tumbling to a critical support level going back 18 months…
Ethereum's drop was dramatic in context as it greatly underperformed Bitcoin, breaking potential flag support…
Exacerbating the decline in Ethereum specifically, was a hiccup in the 'merge' transition process (which is still pegged for August) as it suffered a seven-block chain reorg on Ethereum's Beacon Chain on May 25. A valid transaction sequence was knocked off the chain due to a competing block getting more support from network participants. Fortunately, this situation is not uncommon and it might have emerged from a miner with high resources or a bug.
While the reorg is sure to raise questions about this potential timeline, Van Loon and the other developers have not yet outlined whether it will have any impact at all.
As CoinTelegraph reports, the main victims of Ether’s 11% price correction were leverage traders (longs) who saw over $200 million in aggregate liquidations at derivatives exchanges, according to data from Coinglass.
Finally, we note that the open interest for the Ether’s May monthly options expiry (today) is $1.04 billion
The 0.94 call-to-put ratio shows the slight dominance of the $540 million put (sell) open interest against the $505 million call (buy) options. Nevertheless, as Ether stands near $1,800, every bullish bet is likely to become worthless.
Finally, we wonder if some of the selling pressure on Ethereum specifically was due to Sequoia Capital's ominous presentation which warned its portfolio companies to cut back now to survive and rein in tech projects.