Ethereum is Up 28% Over the Past Few Weeks, How High Can It Fly? -Breaking
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Ethereum’s price has increased 28% over the last few weeks. But, how high could it go?CoinMarketCap reports that it was at $3,058.29 for token as of the writing. This represents a 28% rise from its previous low of $2.211.01 on January 24, 2022. If you haven’t been paying much attention to this “old school” crypto project with the second largest market cap in the sector of $367 billion, you might want to start and here are some reasons why.
Gas prices are falling
As of two weeks ago, Ethereum’s gas fees are down 35% as developers continue to upgrade the network under its ETH2.0 development plan. The plan will boost transaction speeds to over 100,000 transactions per minute, which should further lower transaction costs, network congestion and delay in settlements.
Ethereum’s deflationary drive continues
According to Ethereum tracking website, UltraSound.money, a total of $1.079 billion of Ethereum (ETH) fees were burned during January — setting a single month record. A “fee burn” is an automated “self-destruct” mechanism which removes from the circulating supply of coins a certain percentage of ETH. These fees were previously used to pay ETH miners as reward for their “proof-of-work” protocol as they validated transactions on the Ethereum blockchain.
The fee burn started Aug. 5, 2021 as a key first step toward upgrading the Ethereum network to a more efficient “proof-of-stake” consensus model, following the activation of EIP-1559. This feature, known as the burn, is an attempt to decrease Ethereum’s overall supply in order to increase its value using simple supply and demand principles.
Through the end of last year, the project had removed more than 1.5 million ETH from circulation — the equivalent of $4.5 billion U.S. dollars.
Ethereum is the backbone for popular DeFi and NFT activity
It’s worth noting that the more than $1 billion in burned Ethereum last month was totally transactional gas fees, which means a lot of transactions took place on that blockchain. Most of these transactions were conducted on OpenSea, the world’s leading NFT market. OpenSea set a new single month revenue record in January of more than $5 billion in NFT transactions — most of which occurred on the Ethereum network.
OpenSea records confirm that Ethereum continues to be the principal network for both decentralized finance and non-fungible token exchanges. DeFi has currently $100 billion worth of assets locked on the ETH blockchain. More money is being added to this automated banking system. NFTs have continued to experience explosive growth, with an all-time high of $20.8 million according to nonfungible.com at the time of writing.
What is the highest ETH can fly in a single year?
These trends will continue to be a benefit to the ETH project in 2022. It’s currently trading at $3,058 a 36% discount off its all-time high, and it could double or triple that price this year. Last year, it had a 450% return, so it’s certainly possible given its use cases and positive prospects. Considering the overhanging crypto regulations and current macro conditions, however, it is highly unlikely that the coin will reach $10,000.
Be sure to keep an eye on ETH as it could surprise us all — in a good way!
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