For the first time in more than three months, the Ethereum price is testing the important USD 1,500 mark. With this, the cryptocurrency is rising above a support level that proved to be an important point for the ETH price in the past. Over the past seven days, this has increased pleasantly. In this article, we would like to address the question of whether it could be further increased in the future.
Ethereum price with a tailwind at the moment
Like most of the crypto prices, Ethereum has had a difficult time in the last few months. Since last weekend, however, the price has increased significantly. On Friday, it was at the level of USD 1,440. On Saturday, January 21, it tested the 1,500 mark for the first time and reached $1,537.
The price has remained stable over the past 24 hours. It’s $1,499 today. The market capitalization is about USD 183 billion. 24-hour trading volume fell about 18 percentage points to $6.4 billion.
The price of ETH has already risen by about 30% in 2023. The last few days could be the beginning of a positive development this year. But how did the current price increase come about?
If you compare the price of Ethereum with the price of BTC, you can see almost the same development. Bitcoin has also been rising since last weekend and broke through two important support levels within a few days.
On the one hand, these developments will be due to the macroeconomic environment, which changed at the beginning of the year. The number of published inflation data shows that they fell significantly in December 2022. In both the United States and Europe, the curve is falling and with it the cost of living for private individuals and companies.
Based on these data, it can be assumed that the main interest rate will also stabilize in the coming months. As in the past, crypto prices are clearly responding to these developments. Bitcoin skyrocketed shortly after the release of the data. Other altcoins followed suit.
It looks like merchant support has been restored. Now it remains to be seen how long this will last. However, there are several reasons why Ethereum price will continue to rise in the long term.
Tokenomics, the strength of the network and the merger – This is why Ethereum could continue to rise
Anyone who has been following the development of Ethereum for a while knows that the founders have been planning to make the cryptocurrency more sustainable for several years. This goal was achieved with the merger on 15 September last year. By switching to the Proof of Promise process, the development team was able to reduce power consumption by 99.9%.
With this major update, Ethereum has taken an important step towards a sustainable future. Because the subject of sustainability and environmental protection also has a place in the crypto world. This will become more widespread and important in the future. It is even conceivable that regulations and sanctions against Proof of Work cryptocurrencies are imminent. Because these have long been criticized for their high power consumption.
Despite numerous concerns from investors and experts, Ethereum managed to convince users to merge.
This is proven, among other things, by the data published on the validations on beaconscan.com. It shows that the number of collectors has now increased to over 500,000. At the time of the merger, only about 418,000 people were responsible for the transactions.
Based on these numbers, it can be assumed that the community stands behind Ethereum and believes in the future. It is also a very important development, since the validators are responsible for the successful completion of transactions within the network. Only through them can the speed and security of Ethereum be guaranteed.
The third point favoring the price of ETH still rising is the deflation ratio it is in. That started with the merger. Over 2,800 signs have already been burned since September 15.
Over the long term, cryptocurrency can appreciate significantly when the ratio is deflated. As the number of coins available decreases, the value increases. This can have a positive effect on the price if demand is stable. Compared to other coins, for example Bitcoin, Ethereum has several advantages that could soon be reflected in the price.
Promised rewards are said to be unlocked
Previously, Ethereum’s promised rewards were not accessible to users. The Total Locked Value in the ETH Deposit Contract 2.0 is now over 15,300,000 ETH tokens. This results from the data published by node glass alerts. With the planned Shanghai update, users should be able to unlock their stake worth.
See the metric: https://t.co/SzbMPqvhlb pic.twitter.com/3Tacy9T35e
— glassnode alerts (@glassnodealerts) January 21, 2023
The update should also significantly improve transaction costs and speed. The development team is trying to make this much more user-friendly. Shanghai is to be tested for the first time in February.
This update could mean another price driver for Ethereum. Even if a short-term drop due to increased payouts could be imagined, the price could benefit from this change in the long term.
Over the past year, the majority of traders have suffered huge losses. First, the economic crisis and the energy crisis hit the prices. They suffered another major setback in November after the FTX exchange filed for bankruptcy and could no longer complete payments. But with the current developments, in its own network and in the environment, the price of Ethereum could be managed to break from these negative developments.
The year 2023 is already off to a good start for him and the factors mentioned could help ensure that these developments continue and that he regains his old strength. Due to the big, positive changes, such as the merger and the updates planned for 2023, it is even possible to imagine that it will be much higher than the highest rate ever.