Divide emerges between retail, pros on how to play Ether upgrade

business-standard.com:

The crypto world has been abuzz about Ethereum’s upcoming software upgrade. Yet there’s a divide in terms of how to position for the so-called Merge: retail investors have been selling the underlying token, while institutions continue to buy.

The trading desk at Genesis saw “some fresh bullish ETH views expressed” with investors buying calls and selling puts. Analysts at Enigma say that traders are likely expecting a retracement following Ether’s big rally since June. Trading firm B2C2 is seeing a lot of Ether buying. And yet BlockFi’s customers have been selling in recent days.

“Retail investors are getting a little nervous about another risk-off period for the markets,” given the Federal Reserve’s hawkish stance, said Matt Maley, chief market strategist at Miller Tabak & Co. “Therefore, they’re taking some chips off the table. However, institutional investors, who are more sophisticated, are taking advantage of the dip to add Ether.”

The two cryptos have been volatile of late

Ethereum’s upgrade has been long-awaited and news around it has been welcomed by investors, who have since the start of July pushed its token’s price up by roughly 50%. The blockchain is set to facilitate a move from the current system of using miners to a more energy-efficient one using staked coins. The switch to this so-called proof-of-stake system from proof-of-work is expected to happen soon after being kicked down the road for several years.

Ethereum recently completed its last test before the upgrade, and developers said the main event should take place next month.

Speculators had been positioning for the token to continue its run, though many are also betting that once the upgrade actually happens, Ether could plunge as part of a