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The cryptocurrency markets are currently in a precarious situation, with Bitcoin (BTC) potentially facing a significant drop to $25,000. Meanwhile, Ethereum (ETH) is encountering a crucial support level, raising questions about its ability to sustain its position.
The month of May has been discouraging for ETH traders, as a brief recovery period peaked on May 5 at $2017, followed by a subsequent decline of 13% over the past week.
Ethereum Ecosystem Witnesses Significant Developments and Visa Embraces Stablecoins for Payments and Settlement
Several significant developments have occurred within the Ethereum blockchain ecosystem in the past few days. One notable event occurred on May 6, with the launch of the London testnet for EIP-1559. This upgrade aims to enhance the user experience of Ethereum by introducing a new transaction fee model that makes fees more predictable.
It introduces a dynamically adjusting base fee based on network demand and an optional tip to incentivize miners to prioritize transactions. Despite high investor anticipation, this upgrade did not have the expected positive impact on the price.
On May 7, another major development occurred as the Ethereum 2.0 deposit contract reached the minimum required amount of 10 million ETH. This triggers the next phase of the Ethereum 2.0 upgrade, which aims to address network limitations by implementing a proof-of-stake consensus mechanism, sharding, and other improvements. The Ethereum community has eagerly awaited this upgrade, as it promises improved scalability, security, reduced gas fees, and faster transactions.
Visa also announced its plans to support Ethereum-based stablecoins for payments and settlement, marking a significant move by a major financial institution to embrace stablecoins. Stablecoins are digital assets pegged to the value of a stable asset like fiat currency. This partnership will provide more exposure to ETH and potentially contribute to its increased value.
Visa now settles payments in USDC stablecoin on Ethereum blockchain (via @Yogita_Khatri5)https://t.co/pl04YBNfbp
— The Block (@TheBlock__) March 29, 2021
Despite alternative options and relatively high transaction fees, Ethereum has remained popular among users because of its support for the growth of memecoins. The increasing adoption of memecoins on the Ethereum blockchain shows its potential as a reliable blockchain and bodes well for the prospects of ETH.
At the time of writing, Ethereum (ETH) was $1,829.46, with a trading volume of $6,311,062,419 over the past 24 hours. This reflects a 1.39% increase in price within the last day while experiencing a decline of -1.24% over the past week. With a circulating supply of 120 million ETH, the market cap of Ethereum stands at $225,278,465,860.
ETH Price Prediction – ETH/USD Chart Analysis
The price of ETH has been on an upward trend, trading along the bullish channel. The price signals a bullish move after creating a lower, higher low with a hammer candle. The candle signals the change in price from selling to buying. The price experienced a decline after hitting a new high after its fall to $2,200.
Furthermore, the price is trading above the 200-day moving average, which is currently supporting the ETH price. The relative strength index is also signaling a bullish move. Based on the analysis above, we can predict the price of ETH to reach its next high of $2393.
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