There was a quiet sense of optimism in the cryptomarkets at the start of the present week. It came from the fact that all cryptocurrencies, small and big, saw a steady rise in prices over the previous weekend, and the same spilled over into Monday trading as well. In a financial environment where negative news is abundant both in the traditional markets and the crypto ones, any positive movement quickly caught the attention of all crypto investors.
That covers small enthusiasts like esports players or tech aficionados, but also crypto whales and even institutional buyers. All of them are now following with interest the possibility that the crypto token will continue to gain in value. In that bunch etheruem’s ETH token seems to be most poised for a bigger increase and the reasons for that are both perception and technical. Of course, it is difficult to say that even a big increase in price and market capitalization would mean that crypto finally found its bottom in the most recent crash. But, just knowing that the potential for a rebound exists is something that is generating a lot of excitement even now.
Tracking systems that follow ether futures saw in excess of 230 million USD in losses that took place on the last day. The same is happening as the buying pressure increases on the second-biggest cryptocurrency by token price and market cap. That is happening in the expectation of big catalysts that will take place a couple of months from now. However, the futures, as well as the price of etheruem’s token ETH is showing that the movement is already beginning. The price of the same token also saw a huge resurgence in the last days, climbing to 1,600 USD for the first time in many weeks.
All of this is showing that ETH is moving rapidly ahead of its catalyst even, but also that it is gearing up the rest of the crypto market in a way that could finally signal that the bottom has been found. Others, however, are quick to point out that a futures movement with a rise in the token price does not constitute a reverse of the bear market. Instead, it could be simply a blip that appeared and was exploited by traders so that they can infuse some excitement and positive price movement in a very short time frame. After that, according to the same notion, the regular bear market returns. However, this still does not account for September’s big change in the underlying tech of the etherum’s network.
The term Merge has not been a flashpoint of numerous social media discussions until recently. In fact, even those who do follow the digital currency domain were not in many cases in the loop about it. However, the prices are reacting to the same even in a very positive manner. On a tech level, the Merge is the process of deployment of the execution layer of ethereum. It will be added to the consensus layer that the Beacon chain holds, which is the name of the proof-of-stake blockchain that the network should deploy in the future.
The Merge should work to keep the ETH network more effective, sustainable, and most importantly, scalable. Now, this in-between step is crucial as it tries to balance the present needs of a proof-of-work network with the potential and abilities of the proof-of-stake mechanisms that should get into play with ETH 2.0.
Price Movements and Market Reactions
The signal that something big was taking place came as ETH rose by over 10 percent in a matter of 24 hours. After the recent crypto crash, such movements were rare in the major digital currencies, as most of them were suffering from a drastic lack of trading volume. For many long-term investors, the big purchase – and sales – took place weeks before that. Since then, the potential for investing in any direction was more than limited. However, all of that changed for ETH when the Merge trades began coming in. These managed to take the token out of the 1,000 USD and then 1,200 USD price range, where it was stuck for more than a month.
Then, the big breakouts continued to 1,500 USD and then even 1,600 USD for a short while. The price action on the charts shows 1,800 USD as a possible target for this spike in value, with somewhere around 1,300 USD forming as a stable support line. That injected a huge level of optimism not just for the ETH market, but cryptocurrencies overall. Bitcoin’s BTC token managed to break out to 23,000 USD, which was also the first such movement in many weeks. Its prospects seem weaker than those of ETH, but at least now there is hope that the bottom of the previous crash has been mapped out and set. Still, even if that is true, it will take weeks to prove it either way.
The biggest potential in the ETH network still remains not the retail trading that is pushing the present price consolidation and increases, but the long-term involvement of institutional players. These would be companies like Tesla Motors which would choose to invest in the same cryptocurrency, but do it on a massive level. They will not be enticed by the simple act of the ETH token climbing to any particular value, but they will be interested in the move to the 2.0 version of the network.
Here, the main benefit lies in the staking process, where anything over 30 or so ETH tokens will begin to validate the network and thus bring rewards to its stakeholders. For a company willing to invest millions in ETH, that would mean getting a box that makes additional tokens all of the time. The present boost in price and market cap is a big step towards that destination, but the destination itself will still need to be the actual network upgrades.