The Ethereum (ETH) market price dropped sharply as stability concerns grew as Ethereum blockchain PoS merge approaches.
ETH was trading at $1853.44, down 5.78% since pulling back from a daily peak of $1,976.57.
In the last 24 hours, the Ethereum Beacon chain which was supposed to introduce PoS onto the blockchain underwent a deep 7-block reorganization.
When there is an inconsistency between the blocks’ order, this is called block reorganization. This usually happens because of malicious activities or a bug.
Block reorganization in Ethereum was caused by a bug that revealed that the Ethereum shift from PoS to Ethereum might not be as stable as Vitalik Buterin, co-founder of Ethereum.
Ethereum stability uncertainty
Although the recent reorganization was brief, Ethereum developers are still trying establish the cause. So far, they have confirmed that the blockchain wasn’t attacked.
Martin Koppelmann (Gnosis founder) noted that Buterin could have been too optimistic about how the reorganization stability would improve if Ethereum shifts to PoS.
‘’We have not seen 7 block reorgs on Ethereum mainnet in years.’’
He did however compliment the Ethereum community for its quick response to the issue.
The blockchain shift PoS will also be happening this year to improve blockchain accessibility. Buterin anticipates that the shift will take place by August 2022.
Future Ethereum markets
The Ethereum futures market appears to be in a shaky spot after some option contracts expire this week.
The token has had a large number of liquidations over the last 24 hours. It saw $118 million in liquidations. This is twice as much as Bitcoin. Nearly 97% of these liquidations were long positions, which indicates that traders were prepared for the Ethereum recovery.
However, it hasn’t been able to recover as ETH has been slowing in the crypto markets. The Federal Reserve meeting, which showed that some Central bank officials had suggested additional interest rate increases this year, triggered the losses.