Ethereum prices rose in line with Bitcoin and U.S. equity markets as the roll out of the Merge improved the long-term prospects of Ethereum.

Ethereum prices were up by 18.4% to $1,573 in October 2022 from $1,329 in September 2022, higher than Bitcoin’s equivalent price increase of 5.5% during the same period. Most of the crypto markets were up also in line with higher U.S. equity markets (Dow Jones: +13.9%, Nasdaq: +3.9%) but Ethereum had an extra factor supporting its higher performance compared to Bitcoin – the roll-out of the Merge.

The Merge is the joining of Ethereum with the new proof-of-stake consensus layer, the Beacon chain. For some context, most of the earlier cryptocurrencies (Bitcoin especially) operated on a proof-of-work concept where members of the network had to expend computing power to verify transactions and mine new tokens. However, it takes a large amount of time and resources, where Bitcoin is infamous for having climate change impacts by using large amounts of electricity. Proof-of-stake requires members to stake and hold their coins in transactions, giving them the privilege to earn the fees from the transactions. This requires much less resources and speeds up the transaction speed compared to the proof-of-work system.

Similar to Bitcoin, Ethereum prices are way below its historical price due to the syncing of crypto markets with the overall equity markets.

Ethereum prices are below the peak of $3,790 for 2022, and have traded lower for the year in line with Bitcoin markets. As much as everyone have been talking about crypto markets moving opposite to the equity markets, that movement has recently been in-sync with them. As the fundamental of Ethereum and Bitcoin is rooted in transaction verification, a slowing global economy does have an impact on cryptocurrency markets, similar to equity markets.

Moving forward, Ethereum prices are expected to remain flat, but does have upsides of the Merge working in their favour compared to Bitcoin.

As the global economy is expected to slow especially in the U.S. and Europe, cryptocurrency markets are expected to be the same too. Ethereum prices are expected to be flat in the short-term but do have the advantages of increasing their efficiency of speeding up their transaction speeds and reducing the amount of resources used, compared to Bitcoin.

It remains to be seen how the Merge could increase the operational efficiency of Ethereum but the potential for Ethereum looks brighter than Bitcoin considering many cryptocurrencies are tying their values to Ethereum rather than Bitcoin in the ecosystem.

Technical indicators indicate that Ethereum is already in the middle of an upward trend, with half likelihood of continuing and another half of ending the trend.

The Bollinger band has already widened recently towards an upward trend, with the moving average also trending upwards. Ethereum might be at the peak of its Bollinger band widening as the relative strength index has also reached the previous high in the middle of August 2022. This might indicate a reversal in trend instead.