Arthur Hayes: “If the merger is successful, ether will rise to $3,000”

The former BitMEX CEO suggested that ETH would reach the $3,000 mark this year, thanks to Etherium’s impending transition to the Proof-of-Stake consensus algorithm.

Arthur Hayes said that the reduction in ethers after the successful transition to Ethereum 2.0 will be a powerful boost to ETH. After the merger, the daily issuance rate of the coin will drop from 13,000 ETH to 1,600 ETH. The growth of the crypto-asset will not only be affected by the sharp decline, but the need for users to use the Ethereum network. It is now the network that is being used to create decentralised applications, states Hayes:

“As long as there is no drop in interest in DeFi projects, the demand for Ether will outstrip supply. Therefore, the coin’s price should rise despite the prolonged downturn in the cryptocurrency market and the current macroeconomic environment, with the US Federal Reserve raising interest rates to curb inflation.”

According to a prediction made by the former BitMEX executive in April, the exchange rate for ether should reach $10,000 this year. Now Hayes’ forecasts are no longer so bold, and he has decided to lower the bar to $3,000. The expert explained that even after the Etherium merger, the coin’s exchange rate could suffer a short-term drop of around 20%.

This week, the developers of Etherium activated the Bellatrix update. The merger should be completed in less than a week, following the rollout of the Paris update. However, Hayes believes it is reasonable to doubt that this event will take place. The Etherium merger has been talked about for years, so it’s entirely possible that something could go wrong with the transition. In addition, the cryptocurrency community would be more optimistic about a successful transition of Ethereum to PoS if it were not for the liquidity crisis following the Terra project collapse in May.

Hayes recently suggested that Ether could plummet if the merger fails, but should not fall below $800.