Ethereum has gained by 2.68% in the last 24 hours. As of 11:44 GMT+3, Ethereum was trading at $4063 and was gaining upside momentum. Trading volumes were on the rise, too, hitting $26.370 billion in the day.
The rising momentum around Ethereum has a lot to do with the Dencun upgrade being only 11 hours away. The upgrade is highly anticipated for the way it will revolutionize the Ethereum ecosystem by making transactions on Ethereum layer-2s much cheaper and faster.
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This will also ease the pressure on Ethereum L1, hence helping maintain Ethereum’s position as the number one blockchain platform that combines the three most essential aspects of blockchain: security, decentralization, and scalability.
Drastic Reduction In Transaction Costs
How much of a big deal the Dencun upgrade is is evident in the expected drastic cost reductions on the top Ethereum L2s. Before Dencun, transaction costs on Ethereum are averaging $18, $2.02 on Arbitrum, $1.58 on Optimism, and $0.58 on BASE. After Dencun, the costs on the Ethereum L1 network will remain the same at around $18. However, there will be a major change on the L2s, with costs on Arbitrum expected to drop to $0.40, $0.28 on Optimism, and as low as $0.01 on BASE.
💸 Say goodbye to high #Ethereum gas fees!
The Dencun Upgrade is coming and will entirely change the game for ETH L2 networks
😑Before Dencun: #ETH: $18.75, ARB: $2.02, OP: $1.42, BASE: $0.58…
🙂After Dencun:
ETH remains $18.75, ARB down to $0.40, OP at $0.28, BASE at just… pic.twitter.com/y9bjOjbnvj— Leon Waidmann | On-Chain Insights🔍 (@LeonWaidmann) March 13, 2024
Data shows that the fees could go even lower on other L2s, and some will be able to match L1s like Solana in terms of cost. The only difference is that they are running on Ethereum, which has proven to be one of the most secure and decentralized platform blockchains in the market today.
These changes have seen the number of investments in Ethereum increase, based on the expectation of a surge in transaction volumes on the Ethereum blockchains. There are expectations that the rise in demand after this upgrade could push Ethereum to prices above $5k and open the way for higher prices going into the future.
Anticipation Remains High For Ethereum ETFs
Such projections about Ethereum are not based on the fast-approaching Dencun upgrade alone. There are also the upcoming Ethereum ETFs, which the market is in consensus that they will be approved. Pointers to this include meetings between the SEC and top cryptocurrency exchanges like Coinbase to discuss the same.
The excitement around Ethereum ETFs is driven by excitement that they could have a much bigger impact on the price than the Bitcoin ETFs have had on Bitcoin’s price. That’s because Ethereum currently has deflationary tokenomics, in that the more Ether is staked or locked up in smart contracts, the less it is traded. This means a surge in demand from institutional players could push Ethereum to prices as high as $20k or more.
Overall, Ethereum is experiencing significant buying volumes due to the Dencun upgrade, which is only a few hours away, and there are also positive expectations about the Ethereum ETFs.
Ethereum Buying Volumes On The Rise At Key Resistance, A Signal To A Potential Bullish Breakout
After several hours of sustained gains, Ethereum has hit strong resistance at $4069. However, buying volumes are on the rise, an indicator that a bullish breakout could be underway.
If bulls push Ethereum through the $4069, and more buyers jump in ahead of and during the upgrade, then Ethereum could test its all-time high of $4800 today. FOMO could see Ethereum make $5000 or more highs within the day.
However, two scenarios could play out if bulls fail to push Ethereum through the $4069 resistance in the day. The first is a possible consolidation between the $4069 resistance and the intra-day support of $3835.68.
On the other hand, if short sellers take control and push Ethereum through the $3835.68 support, then prices around $3500 could be tested in the day.
Ethereum Price Prediction – Why $4800 Could Be Hit Today
While there is a chance that Ethereum could consolidate or even turn bearish, the charts are pointing to a potential bullish breakout. This is in line with upcoming news likely to trigger such a breakout. As the Dencun upgrade draws closer by the hour, the odds are that investors anticipating a pump will likely trigger the breakout, and FOMO after that could easily push Ethereum to $4800 or more in just a few hours.
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