Today, the global cryptocurrency market has plunged by 5.89% in the last 24hrs trading at $1.19 trillion. This Downfall is majorly driven by Bitcoin and Ethereum. Bitcoin is down by more than 4& trading around $28,000
Also, Ethereum (ETH) dropped dramatically after a glitch in its proof-of-stake (PoS) plans raised worries about the planned merger.
In the last few hours, ETH has dropped almost 9% to $1,785, its lowest level since March 2021. Over the last 12 hours, it has plummeted along with a jump of liquidations.
In the last 24 hours, the Ethereum Beacon chain, which was supposed to add PoS to the blockchain, suffered a 7-block deep rearrangement. A block rearrangement happens when there is a misalignment in the sequence of blocks, which is generally caused by malicious behavior or a defect.
It was the latter in this situation. However, it also shows that ETH’s planned switch to PoS may not be as solid as founder Vitalik Buterin predicted.
Vitalik Was Too Optimistic!
While the latest restructuring had a little impact, ETH’s top engineers are still trying to figure out what caused it. They have established that it was not a blockchain attack so far.
However, Gnosis founder Martin Koppelmann believes Buterin was overly optimistic when he suggested that switching to PoS would increase organizational stability.
Koppelmann claims that till today, we have never seen 7 block reorgs on Ethereum mainnet.
Also Koppelmann, on the other hand, complimented the Ethereum community for immediately organizing to identify the problem and find a solution.
Option Expiration Also Affected ETH Future Market
The ETH futures market was also messed up this week due to the upcoming expiration of many options contracts.
The token has had an unusually high number of liquidations in the last 12 hours, with around $118 million—more than twice as much as Bitcoin. Nearly all of these were long bets, indicating that traders were anticipating a rebound in ETH.
But the anticipated rebound did not occur. In the last 24 hours, ETH has lagged behind the overall crypto market, with Bitcoin down approximately 1.9%.
Its decline came after minutes from a recent Federal Reserve meeting revealed that numerous central bank officials are inclined to raise interest rates even higher this year.