Ethereum is on the verge of its big upgrade, but why has it fallen more than Bitcoin?

This article has been updated to correct the identification of Citadel Securities.

Hi! Welcome back to Distributed Ledger, our weekly crypto newsletter, hitting your inbox every Thursday. I’m writing this in the heat of Austin, TX where Consensus, a multi-day crypto conference, kicked off today.

As usual, you can find me on Twitter at @FrancesYue_ to send feedback or let us know what you think we should cover.

Crypto in a snap

Bitcoin BTCUSD
is up 0.8% over the past seven days to trade at around $30,181 on Thursday, according to CoinDesk data. Ether ETHUSD
lost 0.7% to around $1,793 in seven days. Dogecoin DOGEUSD meme token
slipped 2% while another dog-themed token, Shiba Inu SHIBUSD,
down 5.4% from seven days ago.

Crypto Metrics
Biggest Winners

Price

%7 days return

helium

$12.00

35.6%

chain link

$9.38

35.3%

theta network

$1.44

19.6%

Cardano

$0.64

16.4%

Tezos

$2.21

13.3%

Source: CoinGecko as of June 9th

Biggest Loser

Price

%7 days return

Terra Luna classic

$0.00007

-27.2%

BitDAO

$0.55

-23.1%

Elrond

$62.67

-17.1%

internet computer

$6.52

-14.7%

waves

$7.87

-13.8%

Source: CoinGecko as of June 9th

ether lags

Ethereum is ready for the “merge,” a long-awaited upgrade that will transition the blockchain from proof-of-work to proof-of-stake, a consensus mechanism that is much more energy efficient. Ethereum co-founder Vitalik Buterin said in May that the “merge” could happen as early as August.

The blockchain is one step closer to this milestone this week as it completed a successful dress rehearsal on the Ropsten testnet on Wednesday.

However, so far this year, ether has outperformed bitcoin, although both have plummeted. Bitcoin is down about 36% year-to-date, while ether is down more than 51%, according to CoinDesk data.

Analysts attributed this in part to investors’ differing perceptions of the two largest cryptocurrencies.

“You almost have to think of it as different valuation frameworks where bitcoin is your reserve value in the ecosystem,” said Jean-Marie Mognetti, chief executive of crypto asset manager Coinshares, in an interview.

As investors worry about heating-up inflation, signs of a slowing economy and the Fed’s tightening of monetary policy, “you can see that people are almost de-risking themselves by switching to crypto, while much of that crypto goes into bitcoin, which is a legacy of the ecosystem,” Mognetti said.

David Siemer, chief executive at Wave Financial, echoed the point. “Many of our clients are wealthy individuals. And their first purchase of crypto through us is always in Bitcoin,” Siemer said.

Ether’s disappointing performance could also be related to the uncertainty surrounding the “merge,” according to Katie Talati, director of research at Arca. The upgrade has been delayed several times in the past, and “I think there’s just a lot of question marks around how and when the merger is going to happen,” Talati said.

However, in the longer term, investors view the appreciation as a bullish event, Talati said. “Some of our trading teams have seen a lot of call buys for longer-dated ETH options.”

Citadel Securities and Virtus crypto push?

Citadel Securities and Virtu Financial Inc. along with Fidelity Investments and Charles Schwab Corp. a cryptocurrency trading platform, while the product could launch later this year or early next year, Bloomberg reported, citing people familiar with the matter.

It marks the first major foray into crypto by Citadel Securities and Virtu. Ken Griffin, the billionaire founder of Citadel Securities and hedge fund Citadel, appears to have toned down his stance on the fledgling asset class recently. Once he described the hunt for crypto as a “jihadist reputation” against the US dollar, but said in March that “crypto has been one of the big stories in finance over the course of the last 15 years.”

“I still have my skepticism,” Griffin said in an interview with Bloomberg at the time. “But there are hundreds and millions of people in this world today who disagree with that…we need to seriously think about being a market maker in crypto. Expect us to get involved in creating cryptocurrency markets in the coming months,” he said.

Coinbase revokes offers

Last week, Coinbase said it would extend a hiring freeze for both new and filling positions for the “foreseeable future” and revoked some accepted offers “in response to current market conditions and ongoing efforts to prioritize companies.”

More than 300 people with diverse expertise ranging from business operations to marketing and technology recently posted details of their work experience on Coinbase Talent Hub, a website the company created to connect affected candidates with other job opportunities submitted. On LinkedIn, some said they had already left their previous jobs for positions at Coinbase, while others turned down competing offers.

I spoke to two people who faced such a situation. Read their stories here.

Crypto companies, funds

shares of Coinbase Global Inc. COIN
crashed 6% to $64.95 on Thursday and down 12% in the last five trading sessions. Michael Saylors MicroStrategy inc
MSTR
down 5.22% to $220.74 on Thursday and down 9.7% over the past five days.

mining company Riot Blockchain Inc.
REVOLT
Shares fell 8.6% to $5.46 and are down 20.4% over the past five days. shares of Marathon Digital Holdings Inc.
MARA
down 9.4% to $7.72, down 17.24% over the past five days. another miner, Ebang International Holdings Inc. ebony,
fell 3.1% to $0.97 while gaining 1.2% over the past five days.

Overstock.com Inc.
OSTK‘s
Shares traded 3.3% lower at $30.95. Shares lost 5% over the five session period.

shares of block inc
Q,
Formerly known as Square, it fell 8% to $77.98, contributing to a 10.8% weekly loss. Tesla Inc. TSLA
Shares are up 1.2% at $734.62 while down 5.2% over the past five sessions.

PayPal Holdings Inc.
PYPL
down 2.2% to $85.56 and down 3.1% over the five sessions. Nvidia Corp.
NVDA
Shares fell 1.2% to $184.26, down 6% over the past five trading days.

Advanced Micro Devices Inc.
AMD
Shares traded down 0.9% on Thursday at $101.03, down 6.9% from five trading days ago.

Under crypto funds, ProShares Bitcoin Strategy ETF
BITO
up 0.1% to $18.70 on Thursday Valkyrie Bitcoin Strategy ETF
BTF
rose 0.2% to $11.64. VanEck Bitcoin Strategy ETF
XBTF
rose 0.4% to $29.42.

Grayscale Bitcoin Trust
Conditions
rose 0.4% to $19.60.

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