As more Ethereum (ETH) is staked, there are concerns among the community that loss-making stakers could create price volatility for the second-largest crypto network. The Ethereum Merge upgrade has helped address critical network issues by introducing staking and sharding, enabling the network to process more transactions per second. The shift to proof of stake (PoS) requires validators to stake a certain amount of ETH and rewards them for verifying transactions. However, the decline in price action and increase in staking has raised concerns as many stakers are now underwater in their position. The research team at Delphi Digital shed light on ‘underwater’ ETH stakers, with over 70% of stakers down on their ETH positions in USD terms since staking. According to analysts at Delphi Digital, loss-making ETH stakers could even pose a threat. Some validators may have also withdrawn their staked ETH to cut losses, while others may choose not to participate in the network, weakening the network’s security as a result. Despite these challenges, there are reasons for optimism about the Ethereum Merge upgrade.