Ethereum, the world’s second most capitalised cryptocurrency, rose by 2.01 percent in the last 24 hours to extend its 2021 returns to 169.76 percent.
Ethereum rose by $31.60 or 2.01 percent from $1,893.21 per coin it opened to $1,922 per coin on Friday.
Investors traded Ethereum valued at $11.09 billion in 1.30 million transaction count at an average transaction fee of $21.44 in the last 24 hours.
The world’s second most valued cryptocurrency has enjoyed a huge surge in capital inflow since Bitcoin took off in the final quarter of last year.
Ethereum was trading at $390.87 per coin as of August 2020 when Investors King predicted its long-term bullish run for the coin.
On January 4th, 2021, it broke the $1000 resistance level and since then it has risen by 97 percent to take its total return since January 1st, 2021 to 170 percent.
Institutional investors are behind Ethereum’s rising value, according to various cryptocurrency reports.
“Since Grayscale Ethereum Trust (ETHE) just bought over 197,890 ETH worth $344 million on behalf of its investors in a span of two weeks, we are witnessing an influx of investments in ether only a few months after bitcoin’s institutional influx,” F2Pool’s Mao told CoinDesk.
Also, the surged in demand for Defi, Decentralised Finance, powered with the Ethereum blockchain is aiding Ethereum bullish run. Presently, the total value locked in Defi stood at $41.8 billion. Twice of its January value.
“Ether approaching $2,000 could be seen as validation of all the dapps and use cases that have blossomed over the years – from DeFi to NFTs,” OKCoin’s Lau said, referring to nonfungible tokens. “It is also benefiting strongly from bitcoin’s increased adoption. The ratio of ether to bitcoin remains at 2%-4%, a range that has persisted since September 2018.”
Cryptocurrency Turnover Increased by 93% in Q1 2022
According to Capital.com quarterly report, cryptocurrency turnover increased by 93 percent in the first quarter of 2022.
As shown by trading platform Capital.com, the Ether (ETH) to the United States dollar (USD) combination attracted the most traders from January to March 2022. The Dogecoin (DOGE) to USD pair was held by the most significant number of traders in 2021, according to the report. However, for the first time in the trading platform, the ETH/USD pair has seized the top spot for most traders.
The report showed that crypto turnover increased by 93 percent throughout the quarter. Despite the optimistic numbers, the report acknowledges that the increase in revenue does not reflect broader market trends because the figure was attained due to a few single-day volume surges.
The larger market is currently disinterested, according to Capital.com. The Bitcoin (BTC) slump from November to January affects retail traders’ interest in crypto, according to Capital.com’s head analyst David Jones. Crypto traders, according to the analyst, are “herd creatures” motivated by momentum.
Following a spike in investor involvement in January, the following months saw a drop. The number of digital asset traders on the platform fell by 16 percent in February. The following month, the number fell by another 10%.
On Monday, the price of ETH rose past $30,900, bringing it closer to the $2,000 barrier. Analysts cautioned, however, that despite the rebound, the prices’ upward trajectory may be less than the mid-year performance of 2021. On the other hand, some analysts believe that over the summer, the price could rise to $2,700.Meanwhile, the Ethereum Ropsten testnet is transitioning to a proof-of-stake (PoS) consensus.
Tim Beiko, an Ethereum engineer, announced that on June 8, the Ropsten testnet will combine with the new Ropsten Beacon Chain, which was deployed on Monday. Before the Ethereum mainnet migrates to PoS, two additional testnets, Goerli and Spolia, will make the switch.
Ethereum Merge: Core Developer Explains Changes to Expect
Tim Beiko, an Ethereum core developer, has given a set of recommendations and expectations for Ethereum application and protocol developers ahead of the impending merge.
Beiko advised ordinary app and protocol users to test things out to verify that nothing breaks when additional tests are run. “Run stuff, if something is unclear or broken, leave a comment,” he tweeted on Tuesday. He also urged users and developers to “pay attention and make sure you are ready” for the Merge.
The Merge is the very complex and long-awaited conversion from proof-of-work (PoW) to proof-of-stake (PoS) consensus on the Ethereum network. It will be known as the Consensus Layer at that time, and it is slated to happen around August of this year.
On numerous testnets, the focus has been on ensuring that there are no cross-client concerns and that current apps do not fail completely after the Merge. In a separate Twitter thread, Beiko noted that such issues are unlikely to arise because “99% of modifications affect the protocol layer,” while “virtually no changes are done to the application layer.”
He also stated that developers should be aware that there will be two major changes to how smart contracts function with the Merge. To begin, he reminded them that the approach for beacon randomization, which aids in the running of programs, will be altered. This was announced in an Ethereum Foundation (EF) update in November and would be required for the migration to PoS.
The second modification will be a reduction in block timings from 13 to 12 seconds per block. Smart contracts that utilize block production speed as a measure of time will run one second faster after the Merge as a result of this change.
However, Beiko exuded confidence that, despite the Merge’s delays, all potential difficulties had been condensed into a single echelon. “Aside from cross-client testing and these two edge cases, the biggest risk of disruption is in ‘tooling and infra pipelines.’”
He concluded by stating that if any further vulnerabilities occur during the extensive testing and shadow forks, the Merge would be postponed further to guarantee the network’s security: “At any point, if we find issues, we’ll obviously take the time to fix + address them before moving forward. Only then will we think about moving mainnet to proof of stake.”
On Monday, DeceDeFi instructor Korpi revealed on Twitter that Ether (ETH) staked on the Beacon Chain can no longer be unlocked without a network update after the Merge. This includes staking-related prizes assuring ETH investors who are concerned that their coins will be released and dumped to relax
He also indicated that once coins are unlocked, they would be delivered in stages rather than all at once, and that those coins are typically an investor’s “never-sell stack” that will not be sold.
On the Beacon Chain, there are presently 12.6 million ETH staked. The Beacon Chain, which began in December 2020, was one of the initial moves toward turning Ethereum a PoS network.
Ethereum Could Hit $8,000 In the Next Two Months – Goldman Sachs
The American multinational investment bank and financial services, Goldman Sachs, has predicted that the price of Ethereum could hit $8,000 by the end of 2021. This prediction was reported in a research note circulated by Bernhard Rzymelka, the managing director of Global Market at Goldman Sachs.
According to Zerohedge, the research note explained in detail how cryptocurrency trading has corresponded with inflation breakevens since 2019.
Referencing a chart showing the Bloomberg Galaxy Crypto Index (red) on a log axis and the USD 2-year forward 2-year inflation swap (blue), Goldman’s analysts noted that “the local backdrop looks supportive for ethereum.”
The analysts said: “It has tracked inflation markets particularly closely, likely reflecting the pro-cyclical nature as ‘network based’ asset. And the lastest spike in inflation breakevens suggests upside risk if the leading relationship of recent episodes was to hold (grey circles).”
They further pointed out that: “This lines up well with the ethereum chart.”
The Investment bank analyst further asserted that: “The market has started to press against the all-time high with a narrowing wedge: Either a sign of exhaustion and peaking … or a starting point of an accelerating rally upon a break higher.” The analyst also noted that “the RSI has yet to hit the overbought levels seen in past market highs.”
According to the research note, if the historical correlation between cryptocurrencies trading and inflation persists, there is a high probability for ethereum price to surge as high as $8,000 in the next two months.
In a recent price prediction by Finder.com, a panel of 50 fintech specialists predicts the price of Ethereum to hit $5,114 by end of 2021, $15,364 by 2025 and $50,788 by the end of 2030.
At press time, Ethereum (ETH) is trading for $4,475 with over $528 billion market capitalization. Ethereum has gained 7.63 percent in the last 7 days and 2.60 percent in the last 24 hours.
Goldman Sachs formally established a crypto trading team and launched bitcoin derivatives trading in May. In the following month the bank’s head of digital assets, Mathew McDermott, revealed plans to offer futures and options trading in Ethereum (ETH) in the coming months.
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