Ethereum is on a surge right now. The second largest cryptocurrency in the world is now trading above $3k in the crypto market. It recently underwent a new update called the EIP 1559 or the London Hard Fork that changed some fundamentals of the network. The price index has jumped up considerably since then. Now that it is above $3k after more than 80 days, here is what to expect from it in the near future.
Ethereum’s London Hard Fork was seen by many with dogged anticipation. The cryptocurrency hadn’t been performing well in the charts for a while now and many thought its long-term bullish scene was now over. The index went below $2k just a few weeks ago to record a multi-month low of around $1.77k at one point but now it has recovered from it with its recent move above $3k.
Initially, the traders were reluctant to bet good money on the network as the London Hard Fork was viewed as too big of a change. However, as BTC surged above $40k and warded off the bearish onslaught, ETH too started to flash green consistently again after a long while.
Image Source: Tradingview
One of the main promises of the London Hard Fork was its burning of underlying transaction fees. ETH historically has had no hard cap and that is why it was always seen as somewhat inferior to Bitcoin and other cryptos with hard limits in place. While Vitalik Buterin, the founder of Ethereum had floated the idea of a hard limit before, he couldn’t garner enough support for it from the community. Instead, the Ethereum developing community focused on another out-of-the-box solution to this problem; deflation. In every ETH transaction, there is a base fee. With the new London Hard Fork, the base fee is not distributed among miners but is burned instead, i.e. wiped off from existence altogether. As a result, now the Ethereum network has become a deflationary asset and now much more appealing for investors.
According to many analysts, Ethereum bulls could be back soon with full power in the near future provided it can continue on with its upward momentum. The long-term target of around $10k is still in play for the cryptocurrency. However, the cryptocurrency has once again slipped below $3k in a bearish buildup to Monday. That might dampen things a little but they are well within a healthy bearish correction range.
Image Source: Crypto Dost
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