Ethereum has been struggling a lot in the past months. Following the general crashing pattern of the market in recent months. The coin reached a new high of over $4,000. Before falling back down following the market crash over a month ago. Losing over 50% of its value in a matter of weeks. But despite this, the coin has persevered.
A week ago, Bitcoin fell below the $30K stronghold. Following this, Ethereum lost its footing at its $2,000 stronghold and fell below.
Related Reading | Ethereum 2.0 Contract Reaches 100,000 ETH Milestone
Ethereum has since regained back some control. Its price is back up in the green.
Bull Run After $2,000?
A bull rally for Ethereum does not seem unlikely at this point. There are projects going on on the Ethereum blockchain that encourages the use of the coin. The scalability alone of Ethereum puts it in a remarkable position to post another recovery. Projects like ETH 2.0 will completely revolutionize the crypto industry.
Once the lower fees are implemented, it means that the bottleneck with small transactions will be solved. Lower fees mean the coin can be used more as a currency instead of an investment asset.
Ethereum breaks $2,000 | Source: ETHUSD on TradingView.com
$2,000 has been the major hold point for Ethereum since the decline. Traders have battled to keep the coin above this point. Speculations being that another bull rally is more likely above this price point than it is below it.
Staking is also another big driver for Ethereum. People can stake their ETH in liquidity pools and get rewarded in tokens. Given this, more people are buying ETH coins for the sole purpose of staking.
Staking ETH is less complicated than trading too. It gives investors a low entry point to get into the market without risking too much. These little entries, albeit small individually, add up over time to increase the market cap of Ethereum.
Ethereum London Hard Fork
Ahead of the London hard fork, Ethereum has seen a bit of increase in the past days. The London hard fork is scheduled to take place in July. It is scheduled to happen packaged with the EIP 1559 as part of efforts to scale the network.
This is targeted to make transactions easier for the users. With a proposal of the gas fee to be sent to the network as sort of a burn. With an optional tip being paid to miners.
Obviously, this has come with opposition from minters. But users and investors alike are excited about this.
High gas fees have been burdensome for a while now due to networks being congested by the large number of new tokens being issued. The London hard fork is part of the plan to solve this congestion problem.
Prior to this was the Berlin hard fork. It took place in April earlier in the year.
According to market speculations, if ETH holds the $2,000 resistance point, then there could be another recovery on the horizon.
But with so little momentum, it is possible that the coins fall back below. This could mean that the coin will experience further downturns before there could another recovery.
Ethereum still maintains a price higher than its previous all-time high. If it breaks, the next major resistance point would be at $1,500.
Developments are still ongoing in Ethereum to ensure the total scalability of the entire network. A complete overhaul to ETH 2.0 is scheduled for 2022.
Featured image from Press Insider Daily, chart from TradingView.com