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The price of ETH surged past $2,000 for the first time since August 2021, experiencing an 11% increase in the last 24 hours following the successful transition of Ethereum’s network to the PoS protocol. Investors are now curious about the future price of ETH, and we have a few predictions of our own.
Shanghai Update: ETH’s Price Surges After Successful Transition to PoS Protocol
Cryptocurrency enthusiasts were eagerly anticipating the effects of the Ethereum Shanghai upgrade, also known as Shapella, on the price of Ether (ETH). Some analysts predicted that the upgrade would result in a sell-off of ETH once it’s completed, causing its price to plummet.
However, the opposite occurred. ETH’s price surged past $2,000 for the first time since last August and continued to rise steadily. It was recently trading over $2,100, up more than 11% over the past 24 hours.
According to Ilya Volkov, CEO and co-founder of crypto trading service provider YouHodler, traders had been waiting for the end of the upgrade to start long position accumulation, and neutral news about U.S. inflation, coupled with deferred demand, pushed ETH price up.
If current macroeconomic conditions remain stable, Volkov believes that ETH will continue its upward trend, even if selling pressure increases in subsequent weeks.
The Ethereum network has undergone a significant upgrade from the proof-of-work (PoW) protocol to the proof-of-stake (PoS) protocol. The former is known for its energy-intensive usage, while the PoS mechanism is preferred for eco-friendly operation.
This transition has been the center of attention for many market observers who have been closely monitoring the impact of this change on the network’s performance and the price of its native token, ETH.
Despite initial doubts about the outcome of this transition, it appears that the adoption of the Shapella upgrade has had a positive effect on the overall market sentiment toward Ethereum. This has resulted in a surge in the token’s price, indicating a possible rise in confidence among investors.
Moving to a PoS protocol is beneficial in several ways. It boosts the network’s energy efficiency while also improving its security and scalability, making it more resistant to attacks and able to handle an increasing number of users.
The Ethereum network is well-positioned now to continue its upward trajectory and remain a leading player in the rapidly evolving blockchain ecosystem with the successful implementation of the Shapella upgrade.
Bitcoin also saw a moderate increase, while other major cryptocurrencies experienced significant growth. The token’s performance was up nearly 5%. The overall crypto market cap too crossed the much-awaited 1.2 Trillion mark and is fairly near the 1.3 Trillion mark at the time of writing.
Despite the recent upward trend, the trajectory of ETH deposits into ETH staking contracts since January 2021 suggests that the asset is gaining, not losing, favor. However, as investors who must un-stake ETH begin the process of doing so, this metric will likely flatten over the coming weeks and months. But for those who want to stake, Shapella’s completion signals reduced risk, increased liquidity, and brought an uptick in asset value.
ETH Technical Analysis
Ethereum’s price has skyrocketed following the Shanghai upgrade. The digital currency has surpassed Bitcoin, experiencing a 7% surge in today’s trading and reaching its highest point since August of last year.
Ethereum’s market performance has surpassed the 65.00 resistance level and currently stands at 69.44. However, if the currency falls back into the $1,800 to $1,700 support range, the token could be facing some issues. If that occurs, ETH may return to either the midpoint at $1,750 or the range low at $1,687.
Despite the lack of clear signs of a rally, traders do not expect any panic selling. Unless there is a significant increase in the number of staking unlock requests, Ether’s price could remain near $2,100 for the foreseeable future. However, a reentry into the support zone could cause a downward trend for the cryptocurrency.
Ethereum was trading above the major simple moving averages (SMAs), indicating robust support on the downside. The SMAs were also facing upward, suggesting that the market still favored the upside. A resistance level of 75.00 appears to be the next hurdle for bulls, and should momentum continue in an upward direction, ETH could move above $2,200 this week.
Although the Shapella upgrade may not be garnering attention at the moment, it has promising implications for the future of the Ethereum network. By moving from proof-of-work (PoW) to proof-of-stake (PoS), the network’s energy efficiency, security, and scalability are all enhanced, providing more protection against possible threats and allowing for a larger user base.
ETH’s Price Prediction For 2023
Ethereum’s recent surge in price following the Shanghai upgrade has been significant, but traders remain cautious about a potential reentry into the support zone. We have a few predictions of our own and here’s where we believe ETH’s price could land in the near future.
The price of Ethereum (ETH) is expected to continue rising as it breaks through key resistance levels, potentially reaching $3,000. The relative strength index (RSI) for ETH has shot above 70, indicating strong momentum, while its 30-day moving average is rising above the 200-day average, suggesting a breakout rally.
The successful launch of Ethereum’s Shanghai upgrade has also fueled bullish sentiment among investors, despite concerns that it could trigger a sell-off. The upgrade unlocks 16.3 million ETH worth around $30.5 billion, but the amount awaiting withdrawal represents only 5% of the total amount staked and will be gradually released into the market.
There are estimates from analysts that suggest that with the successful launch of the Ethereum Shanghai upgrade, approximately 60% of Ethereum’s total supply may end up being staked. This could result in a decrease in supply and an increase in demand, which could be advantageous for Ethereum.
If the value of the token continues to rise, it could reach $3,000 in the middle of this year and may even go up to $4,000 by the start of 2024. Moreover, if there is a new bull market in the following year (which could be more likely due to the next Bitcoin halving), Ethereum might have a chance to break its current record high of $4,878.
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