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Is Ethereum Price $4K Rally at Risk Amid Pectra Upgrade Division Talks?

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3 days ago

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Ethereum price plunged 0.21% to $2411 during a less volatile weekend. The modest downtick can be attributed to market uncertainty as Ethereum developers consider splitting the highly anticipated Pectra upgrade. Will the split affect the ETH rally to $4000?

Will Ethereum Price Rally Stall as Pectra Upgrade Faces Division?

The Ethereum developers are considering splitting the highlighted anticipated Pectra upgrade, which is set to enhance the network’s scalability, security, and efficiency, into two distinct parts to meet the 2025 deadline.

Christine Kim, a researcher at Galaxy Digital, believes “the scope of the Pectra upgrade could change drastically if devs decide to split it across two hard forks.”

The plan includes dividing the 20 Ethereum Improvement Proposals (EIPs), with some additional updates still under review. Kim noted the first part could be released by February 2025 and is focused on significant changes to the network’s execution layer and consensus layer.

The second phase will prioritize implementing the Ethereum Virtual Machine (EVM) Object Format (EOF) and PeerDAS, which will further optimize Ethereum’s efficiency and scalability.

This proposal will be finalized in next Thursday’s All Core Devs call. While the Ethereum price could witness initial volatility, the two-stage update reflects developers’ dedication to ensuring a successful Pectra upgrade, which may boost bullish momentum.

According to the Santiment data, the 30-day MVRV ratio at -1.75 accentuates that short-term ETH holders are witnessing loss. This negative value often coincides with a potential price jump as the typical speculative trader exits the market at a loss, while large holders use this opportunity to accumulate.

Ethereum (ETH) priceEthereum (ETH) price
30-day MVRV Ratio | Santiment

ETH Price Heading For Key Resistance Breakout

The Ethereum price daily chart shows a V-shaped reversal from $2,150 to $2,440, registering a 13.4% growth. This second reversal within five weeks accentuates the active demand pressure around the $2,000 psychological level, which pushed the ETH price above a critical downsloping resistance. 

While the weekend volatility allows buyers to retest the breached resistance, the post-breakout rally could bolster a 17% rally to challenge the $2,800 resistance. A successful breach of this barrier will set the Ethereum price prediction target at $3,550, followed by $4,100.

Ethereum PriceEthereum Price
ETH/USDT -1d Chart

However, a negative alignment in daily exponential moving averages (20, 50, 100, and 200) and  Metalpha’s $90M ETH sale has accelerated overhead selling. If the $2,800 resistance holds firm, the ETH price could prolong its current consolidation and may revisit the $2,000 bottom support.

Frequently Asked Questions (FAQs)

The potential split of the Pectra upgrade may create initial market volatility, but developers remain committed to ensuring a successful upgrade, which could boost recovery momentum.

Ethereum developers are planning to split the Pectra upgrade to reduce complexity and meet the 2025 deadline, implementing the changes in two phases

The key resistance level for Ethereum is around $2,800, with a potential price target of $3,550 to $4,100.

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Sahil Mahadik

Sahil is a dedicated full-time trader with over three years of experience in the financial markets. Armed with a strong grasp of technical analysis, he keeps a vigilant eye on the daily price movements of top assets and indices. Drawn by his fascination with financial instruments, Sahil enthusiastically embraced the emerging realm of cryptocurrency, where he continues to explore opportunities driven by his passion for trading

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.





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VanEck Chief Defends Ethereum Against Recent Attacks, What’s In for ETH Price?

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2 weeks ago

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September 7, 2024

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Amid strong criticism for the Ethereum blockchain and its underperformance this year, VanEck head of digital assets – Matthew Sigel – has come out defending the network while citing its strong economic model. The ETH price has also been subject to criticism failing to show enough traction even after the launch of the spot Ether ETFs in July 2024.

VanEck’s Matthew Sigel Addresses Ethereum Criticism

Expressing his frustration over the recent ETH bashing, VanEck Head of Digital Assets – Matthew Sigel – is “exhausting and intellectually dishonest”. While comparing with the price-to-earnings (PE) ratio in traditional finance, Sigel emphasized the importance of “moneyness” for Layer 1 blockchains like Ethereum and Solana.

He said that users should always judge a blockchain by its usage, utility, and trust within its ecosystem as a medium of exchange, store of value, and unit of account. Sigel added that Ethereum’s core utility stems from its role in supporting validators by paying transaction fees, thus driving broader use in DeFi and other services.

The VanEck chief also argued that a token’s value comes from the demand for goods and services traded for it, with Ethereum’s economic activity contributing to its long-term value. Besides, Sigel also acknowledged some of the challenges facing the blockchain.

He said that the surge in Layer-2 solutions for Ethereum is driving capturing transaction fees, potentially reducing the revenue that the blockchain collects. However, its focus on data availability could become more lucrative as the ETH ecosystem evolves. Besides, Ethereum co-founder Vitalik Buterin recently shared that he’s not fond of holding L2 tokens.

Sigel added that Solana’s low has attracted several Defi players to the platform. However, he added that Solana’s fee should increase over time in order to justify its valuation.

ETH Price Faces Bearish Sentiment

Poor demand and continued outflows from spot Ethereum ETF have led to a lack of catalyst to trigger the ETH price rally. On the other hand, other macro factors and hackers selling $42 million of ETH have contributed to the ETH price slump.

As of press time, the Ethereum price is trading 2.6% down at $2,284 with a market cap of $274 billion. This comes amid the broader crypto market crash following the Nvidia stock rout on Friday.

The spot Ethereum ETF market is also seeing waning demand with over $500 million in total outflows since launch. On Friday, VanEck even decided to shut down its Ethereum Futures ETF amid waning market demand.

Interestingly, analysts continue to remain bullish on ETH believing that it’s the final calm before the storm.

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Bhushan Akolkar

Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.





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Ethereum Foundation Dumps 35K ETH, ETH Price Plunges 12%, Recovery Ahead?

Published

3 weeks ago

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August 28, 2024

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Ethereum price saw a strong selloff on August 27 in the late US session and was in line with broader crypto market corrections. One key aspect that stood out for ETH investors is the August 23 transfer of 35,000 ETH from the Ethereum Foundation. This is not the first time the entity behind Ether has transferred and sold ETH from its holdings. Every time such a transfer was noted, Ethereum price suffered a fatal crash.

 

Ethereum Foundation’s Sell Signal Record

On August 23, the Ethereum Foundation’s balance dropped from 309,000 ETH to 274,00 ETH. Data from Arkham Intelligence showed that the 35,000 ETH was transferred to Kraken. Every time the entity sells ETH, it has a vivid impact on the price of Ether. Crypto investors consider the foundation’s transfers a top or sell signal as the Ethereum price often crashes, forming a local top.

The August 23 transfer resulted in a 14.51% crash in Ethereum price in the next five days.

Ethereum Foundation Transfer vs. ETH priceEthereum Foundation Transfer vs. ETH price
Ethereum Foundation Transfer vs. ETH price

Historically, this outlook has remained true. For example, the May 6, 2023, transfer of 15,000 ETH worth nearly $30 million triggered a 16% plummet after a month and a 24% crash in the next three months. 

Ethereum Foundation currently holds 274,000 ETH worth $675 million. ETH price has bounced nearly 4% from the August 27 bottom of $2,392 and shows promise of a further recovery if Bitcoin manages to recover above the $60,000 psychological level. 

Ethereum Price Analysis: ETH Short-Term Recovery Rally on the Cards

Ethereum price has cleared the sell-side liquidity below the swing lows formed after August 12. This development, called rinsing, is often seen in the crypto futures markets, where prices drop before triggering a bullish move. With that in mind, investors can expect the recovery rally from Ether to be strong. 

One condition for this bounce is Bitcoin’s strength. If BTC price reflects bullish momentum and flips the $60,000 key level into a support floor, it would suggest the start of a recovery rally for not just ETH but also the rest of the crypto markets.

Such a development could see Ethereum price forecast hint at a revisit the $2,618 hurdle that was recently flipped into a resistance level.

ETH/USDT 4-hour chartETH/USDT 4-hour chart
ETH/USDT 4-hour chart

Adding credence to this outlook is the recent uptick in whale transactions worth $1,000,000 or more. These transfers serve as a proxy of institutional investors, and when these transactions occur after a price drop, they often correlate to dip-buying opportunities. More often than not, if this metric spikes after a brutal selloff, it is proceeded by quick price reversals.

Ethereum price vs Whale Transaction CountEthereum price vs Whale Transaction Count
Ethereum price vs Whale Transaction Count

On the other hand, if Etheruem price fails to recover, it could crash another 11% before it encounters a key support level of $2,190. 

Frequently Asked Questions (FAQs)

The Ethereum Foundation’s transfer of 35,000 ETH on August 23 is one of the reasons for the recent ETH price drop.

The ETH price plummeted nearly 12% from a high of $2,699 to $2,387.

Previous transfers from Ethereum Foundation have catalyzed double-digit crashes that have lasted up to three months.

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Akash Girimath

Akash Girimath is an engineer at core, but is interested in the chaos of the financial markets. Akash is senior report and analyst who also trades cryptos on a regular basis and maintains a small crypto fund for friends and family.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.





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Ethereum Foundation Moves $94.07M ETH To Kraken, What’s Next?

Published

4 weeks ago

on

August 23, 2024

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The Ethereum Foundation has been actively selling off its holdings of Ethereum (ETH) over the past few months. Today, the foundation transferred its largest pile in 2024 amid Fed rate cut speculations and ETH options expiry.

Ethereum Foundation Largest ETH Transfer of 2024

The Ethereum Foundation has transferred 35,000 ETH, equivalent to approximately $94.07 million, to the Kraken exchange, marking its most substantial transaction of the year. This move follows a series of minor sales in recent months, where the foundation liquidated 2,516 Ether for $7.4 million in DAI. 

However, the foundation’s actions are scrutinised as it liquidates parts of its Ethereum holdings.

This recent transfer stands out due to its size and adds to the ongoing discussion regarding the Ethereum Foundation’s strategy and timing in managing its assets. The foundation has been known for its market timing, having made significant sales during market peaks, which has led to heightened interest from the crypto community in its recent activities.

Timing Amid Fed Rate Speculations

The timing of this Ethereum Foundation large transfer coincides with broader market movements influenced by speculations surrounding potential Federal Reserve rate cuts. Fed Chair Jerome Powell has recently hinted at possible policy adjustments during his Jackson Hole speech, leading to a surge in Bitcoin and ETH price. 

In addition, the expiration of 140,000 Ether options with a notional value of $370 million today has further amplified market volatility. 

The maximum pain point for these options is $2,625, and the heightened trading activity has led to a surge in open interest and trading volume, adding to the speculation around Ethereum’s near-term price movement.

Concurrent with the transfer, developers have hinted at a new upgrade dubbed “Fulu-Osaka.” According to a CoinGape report, EtherCast developers recently had their 140th All Core Developer Consensus Conference Call (ACDC), during which they discussed this upcoming upgrade. The Fulu-Osaka upgrade could play a role in the network’s future performance, potentially driving further interest in ETH

Historical Context and Strategic Management

The Ethereum Foundation has historically demonstrated a pattern of selling large amounts of Ether during market highs. This trend was highlighted when it sold 20,000 ETH in November 2021 at the peak of the previous bull market cycle. 

Similarly, in 2017, co-founder Vitalik Buterin disclosed that the foundation had sold 70,000 ETH at the peak of that year’s market rally. These decisions have often been seen as strategic, leveraging market conditions to optimize the foundation’s financial position.

The recent transfer also follows a significant move in July, when the foundation moved 92,500 ETH, valued at $294.9 million, to a new wallet. This was the foundation’s first significant transfer in over six years, further fueling speculation about its long-term strategy. Despite this, ETH price has remained relatively stable after the transfer, trading at around $2,729, a 4% increase over the last 24 hours.

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Kelvin Munene Murithi

Kelvin is a distinguished writer specializing in crypto and finance, backed by a Bachelor’s in Actuarial Science. Recognized for incisive analysis and insightful content, he has an adept command of English and excels at thorough research and timely delivery.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.





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