Citi: Ether Extends Rally Ahead of the Merge Despite Bitcoin Weakness

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Citi: Ether Extends Rally Ahead of the Merge Despite Bitcoin Weakness
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In a report looking at the ethereum Merge, Citi says there are key differences between previous upgrades and this one, because for the first time in their history, digital assets are facing tightening financial conditions, By willcanny99

Ether has gained 43% since the “post-Luna crunch” in mid-June, while its main competitors have lagged, with BTC declining 1.4% over the same period, the report said.

Citi notes that while there have only been three similar events in bitcoin’s history, there has been a tendency to rise in the ensuing 50 days. While BTC “halving” events only halve block rewards and – as a result – net issuance, ETH issuance is expected to decline by as much as 89%. The futures market is now at a $20 discount to spot after having traded at a premium until the start of June. Perpetual future funding rates have also turned increasingly negative as users sell short the perpetuals and buy spot ETH in order to be eligible for any potential airdrop, the report said.

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