March 10, 2024

Ether Surges Beyond $4,000 for the First Time Since 2021, Catalyzing Altcoin Momentum

Amidst network advancements and burgeoning interest in a potential spot ether ETF, ETH catapults past the $4,000 mark, marking a significant milestone.

In a buoyant crypto market landscape, ether has broken temporarily through the $4,000 barrier, echoing bitcoin's recent surge to a new all-time high, soaring above $70,000 on Friday.

This latest rally commenced in early February, propelling ETH from approximately $2,300 to $3,000 within a span of three weeks.

ETH/USD (weekly chart)

While ether's resurgence to $4,000 is indeed noteworthy — a level last seen in December 2021 — the cryptocurrency still trails 20% below its all-time high of $4,868 reached on November 15, 2021.

A pivotal moment occurred in September 2022 with the long-awaited 'Merge', transitioning Ethereum from a proof-of-work to a proof-of-stake algorithm. Following this transition, ETH traded around $1,300 in the ensuing weeks.

The implementation of Ethereum Improvement Proposal 1559 ushered in the era of ether burn, significantly intensifying over the past year. The amount of ether incinerated from transaction fees rapidly exceeded the $100 million mark and has now soared to a new zenith.

Ultrasound Money, a platform dedicated to monitoring ether performance since EIP-1559, reports over 1.5 million ETH burned, amounting to approximately $2.9 billion at current valuations. This burn surpasses newly issued ETH, rendering the network deflationary.

As of the latest data, the total supply has dwindled from 120,521,245 to 120,097,564 ETH since the 2022 upgrade, signifying a reduction of 423,681 ETH worth more than $1.65 billion.

March 1st marked the commencement of ether's ascent towards $4,000, coinciding with the impending Dencun upgrade slated for March 13. This upgrade promises enhanced technical capabilities and reduced transaction costs on Ethereum's scaling networks.

The approval of several bitcoin ETFs by the U.S. Securities and Exchange Commission in January fueled optimism for a spot ether ETF approval. While Standard Chartered foresaw spot ether ETFs propelling the price to $4,000, the milestone was reached independently.

However, the market eagerly awaits the impact of these developments, with the SEC postponing its decision on BlackRock's ether ETF. Grayscale, VanEck, and Franklin Templeton, along with BlackRock, have submitted proposals for spot ether ETFs, adding to the anticipation surrounding ether's future trajectory.

In the dynamic realm of cryptocurrency markets, ether's surge often serves as a harbinger of momentum across the broader altcoin landscape. This phenomenon underscores the intricate dance of market rotations within the crypto sphere.

As ether embarks on its upward trajectory, a ripple effect often cascades through the market, propelling other altcoins to follow suit. This rotational pattern reflects investors' shifting sentiments and their quest for diversified opportunities within the crypto space.

Historically, ether's movements have acted as a litmus test for the market's appetite for risk and innovation. When ETH gains momentum, it not only underscores confidence in Ethereum's ecosystem but also stimulates interest in alternative projects and tokens.

This trend highlights the interconnectedness of various cryptocurrencies and the symbiotic relationship they share within the larger digital asset landscape. As Ethereum paves the way, it beckons attention to the innovative projects and platforms that thrive within its ecosystem and beyond.

Thus, ether's resurgence beyond $4,000 not only signifies its own prowess but also serves as a catalyst for the broader crypto market, igniting a wave of enthusiasm and opportunity for investors and projects alike.

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