Mail merge

Why did Ethereum Classic jump, as Ethereum Merge countdown begins?

Good morning! Welcome to Distributed Ledger, our weekly crypto newsletter that hits your inbox every Thursday. I’m Frances Yue, crypto reporter at MarketWatch. I’m back from vacation and I’m going to show you the latest in the digital asset market.

Find me on Twitter at @FrancesYue_ to send feedback, or tell us what you think we should cover. You can also reach me via email to share your personal stories with crypto.

Crypto at a Glance

BitcoinBTC USD,
+6.71%
lost around 3.3% in the past seven days and was trading at around $19,134 on Thursday, according to data from CoinDesk. Ether ETHUSD,
+3.73%
gained 4.2% over the seven-day period to reach around $1,618. Dogecoin DOGEUSD Meme Token,
+3.68%
was trading down 0.9% while another dog-themed token, Shiba Inu SHIBUSD,
3.69,
added 0.7% from seven days ago.

Cryptographic metrics
The biggest winners Price %return in 7 days

Classic Terra Luna

$0.0005

126.7%

TerraClassicUSD

$0.04

41.6%

EOS

$1.62

17.9%

cosmos center

$13.7

16%

rocket pool

$26.63

13.5%

Source: CoinGecko as of September 8
The biggest declines Price %return in 7 days

Chain

$0.068

-17.5%

NEXO

$0.89

-17.1%

Chiliz

$0.19

-14.5%

LEO token

$5.13

-11%

amp

$0.006

-10.5%

Source: CoinGecko as of September 8
The rise of Ethereum Classic

As the highly anticipated Merge upgrade of Ethereum begins, Ethereum Classic, a separate blockchain representing an original and unchanged history of the Ethereum network, has seen its symbolic price increase. Ethereum classic ETCUSD,
+5.68%
gained more than 12% in the last seven days, outperforming ether, which added around 4%.

Explain : What is Ethereum Merge? Here are 5 things you need to know

What is the difference between Ethereum and Ethereum Classic? In 2016, after more than 3.6 million, or roughly $60 million, worth of Ether was mined from the DAO, a decentralized autonomous organization based on Ethereum, the Ethereum Foundation controversially created a new version of the blockchain with no history of hacking. The new chain operated as Ethereum, while the old unchanged network was renamed Ethereum Classic.

Now, Ethereum miners are looking for other coins to mine, like Ethereum Classic, as they will lose their source of revenue after the Ethereum merger moves the blockchain from proof-of-work to proof-of-stake. Once the merger is complete, Ethereum will rely on stakers, or ether holders who lock their coins, to secure the blockchain, instead of miners. Ethereum Classic, on the other hand, will remain a proof-of-work blockchain.

The increase in price and interest in Ethereum Classic from miners and users “is not necessarily temporary,” said Jason Lau, COO of OKCoin.

The price of Ethereum Classic could “end up at a higher level than where we were, because now you really have two different types of products,” Lau told Distributed Ledger in an interview.

Some miners have also proposed to split Ethereum again after the merger, with a chain that retains the proof-of-work mechanism. Compared to Ethereum Classic, the crypto community’s interest in such a new chain might be temporary, according to Lau. “I think they will have a lot less community support. It’s sort of a last push by Ethereum miners to capture some economic value,” Lau said.

Listen to Mike Novogratz at the Best New Ideas in Money Festival September 21 and 22 in New York. Galaxy Digital CEO has ideas for navigating the crypto winter.

Merge, one“non-event” for the price of ether?

According to Rance Masheck, president of iVest Plus, the impact of the Ethereum merger on the price of ether could be compared to that of a company’s stock split on its stock price.

“I think it’s going to cause a bit of volatility around ether in the short term, but long term I think it’s going to be kind of a non-event,” Masheck said. “It’s like we just saw Tesla do its five-for-one stock split, and its shares haven’t exactly gone up since the split,” Masheck said.

Lau echoed this point, pointing out that the merger would not immediately solve Ethereum’s widespread problems, such as high transaction fees.

“I think it’s a good step for the network and the community on the way back. But in terms of price, I think there will be some pressure afterwards,” Lau said.

Are Crypto Securities?

Gary Gensler, chairman of the U.S. Securities and Exchange Commission, said on Thursday that the “vast majority” of the roughly 10,000 existing crypto tokens are securities, MarketWatch’s Chris Matthews reported.

“The investing public buys or sells crypto security tokens because they expect profit from the efforts of others in a joint venture,” Gensler said.

Gensler also responded to those who argued that current securities law was incompatible with cryptocurrencies and demanded a new set of industry-specific rules.

Through statements and dozens of enforcement actions, the SEC has made it clear how the existing law applies to the industry and that no such rule is expected, according to Gensler. “Not liking the message is not the same as not receiving it,” Gensler said.

Crypto companies, funds

Shares of Coinbase Global Inc.. PIECE OF MONEY,
+7.08%
gained 4.2% to $71.14 on Thursday, and they are down 8.5% over the past five trading sessions. by Michael Saylor MicroStrategy Inc.
MSTR,
+7.27%
rose 7.8% on Thursday to $229.07, while shares are up 3.7% over the past five days.

mining company Blockchain Riot Inc. RIOT,
+13.89%
shares jumped 12.2% to $7.36 on Thursday, contributing to a 13% gain over the past five days. Shares of Marathon Digital Holdings Inc.
MARA,
+13.53%
jumped 11% to $13.00, up 13% in the past five days. Another miner Ebang International Holdings Inc.. EBON,
-0.66%
saw the shares rise 0.4% to $0.48 on Thursday, for a 3.3% increase over the past five days.

Overstock.com Inc.
OSTK,
+4.11%it is
shares rose 3.2% to $27.36. Shares rose 6% in the five-session period.

Shares of Block Inc.
SQ,
+4.08%,
formerly known as Square, added 3.2% to $29.96 and was up 1.7% for the week. Tesla Inc.. TSLA,
+1.96%
shares rose 1.7% to $288.63, up 4.1% in the past five days.

PayPal Holdings Inc.
PYPL,
+1.26%
edged up 0.9% to $95.76, up 3.4% over the five-session period. Nvidia Corp.
NVDA,
+2.01%
the shares rose 1.3% to $138.87, representing a loss of 0.4% last week.

Advanced Micro Devices Inc.
AMD,
+3.98%
shares rose 3.4% to $82.34 on Thursday, flat from five trading days ago.

Among crypto funds, ProShares Bitcoin Strategy ETF
BITO,
+2.06%
added 1.4% to $11.82 on Thursday, while its Bitcoin Short Strategy ETF
COCK,
-2.00%
lost 1.6% to $39.95. Valkyrie Bitcoin Strategy ETF
BTF,
+1.79%
rose 1.5% to $7.39, while VanEck Bitcoin Strategy ETF
XBTF,
+1.63%
traded 1% higher at $18.63.

Grayscale Bitcoin Trust
GBTC,
-0.57%
lost 0.7% to $12.09.

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