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Traders Eye Continuation For Ethereum Toward $900 After ETH2 Launch

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Nick Chong



  • Ethereum is expected to shoot higher in the weeks ahead despite the recent price consolidation.
  • The cryptocurrency has held well in the high-$500s despite some downward pressure in the Bitcoin price.
  • Analysts think that ETH could push toward $900 and beyond in the near future, especially due to the positive fundamental event of the ETH2 launch.
  • Boosting Ethereum’s prospects, analysts are also bullish on Bitcoin.

Ethereum Could Shoot Even Higher, Leading Analysts Say

Ethereum is expected to shoot higher in the weeks ahead despite the recent price consolidation. The coin has maintained the high-$500s, holding below its year-to-date highs of $620.

One leading crypto-asset analyst thinks that this may be a precursor to a strong upward breakout. He recently shared the chart below, which shows that Ethereum is consolidating above a key support level on its macro chart. This consolidation could be a precursor to a breakout toward $900, the analyst believes.

Boosting Ethereum’s prospects, analysts are also bullish on Bitcoin. BTC is expected to push higher as institutional players continue to embrace this space. This buying pressure from Wall Street will drive Bitcoin toward $100,000, say some investors, such as the CIO of Off the Chain Capital and Preston Pysh, a financial analyst.

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Chart of ETH's price action over the past few years with an analysis by crypto trader Cactus (TheCryptoCactus on Twitter).
Source: ETHUSD from TradingView.com

Fundamentals Bullish

The expectations of a strong Ethereum rally come as the ETH2 upgrade has finally been rolled out. The first phase of the upgrade launched on December 1st, giving users the ability to stake their coins in exchange for rewards should they maintain their nodes correctly.

Analysts think that this upgrade will result in a decrease in the issuance of Ethereum. This should help to increase prices in the long run, assuming that demand is consistent or grows to meet this shrinking demand.

As Messari analysts wrote about the potential effects of the upgrade on the Ethereum supply:

“Further reducing the potential issuance of ETH 2.0 until Phase 1.5 are the likely shape of the staking adoption curve, validator performance, and transaction fee burns (EIP 1559). Staking participation will likely start low and increase over time as holders gradually become more comfortable with the Beacon Chain and deposit more ETH into the deposit contract. The result of these three factors is that net issuance from ETH 2.0 could be significantly lower than what’s projected on the above chart.”

Analysts are also optimistic that ETH2 will mark a decisive upgrade for the usage of the protocol. This improved user experience could also drive further grow in the Ethereum ecosystem over time.

Featured Image from Shutterstock
Price tags: ethusd, ethbtc
Charts from TradingView.com
Macro Analysis Predicts Bitcoin Has Begun Rally Toward $100k





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Ethereum

Ethereum’s realized cap spikes to record highs as capital floods in: Report

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Cointelegraph By Samuel Haig

Ethereum’s realized capitalization has increased by nearly 50% in January so far to tag new all-time highs above $70 billion, according to CoinMetrics.

The data shows that Ethereum’s realized cap has more than tripled since dropping below $25 billion in during March 2020’s “Black Thursday” crash..

Ethereum’s realized cap: CoinMetrics

The realized capitalization metric calculates the value of a crypto asset’s supply according to when each unit last moved on-chain. The indicator seeks to estimate the price actually paid for each ETH in circulation — rather than simply multiply the current price by the total supply as market cap does. However, realized cap cannot account for coins that are only traded on centralized exchanges and do not move on-chain.

The indicator is designed to offer a way to compensate for lost or unclaimed coins by ignoring their appreciation from the time each unit was last transferred on-chain.

By ignoring the fluctuating capitalization of dormant coins, realized cap offers a signal for when new capital is flowing into a given market, with CoinMetrics inferring that many new investors may have been buying the bags of seasoned ETH whales during January’s bull market.

The report also noted a 5% spike in the number of Ethereum addresses holding more than 10,000 Ether, with 1,241 wallets currently holding $13.8 million or more in ETH. As such, CoinMetrics concludes that “institutional investors are starting to buy ETH.”

The growth of Ethereum’s realized cap appears to have outperformed that of Bitcoin’s last year, with Glassnode reporting that BTC’s realized cap had grown 50% since the beginning of 2020 as of Dec. 15. CoinMetrics’ data indicates Ethereum had seen an 85% increase over the same period.

Blockchain Center’s Flippening Index currently estimates that Ethereum is 71% of the way to surpassing Bitcoin according to eight key metrics — comprising a new all-time high for the indicator.

The index notes Ethereum has already surpassed Bitcoin by transaction fees and transaction count, and estimates that transaction volume and node count are at 99% and 97% of Bitcoin’s respectively.