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- The price of Ethereum prepares to advance further as the fundamentals behind it have yet to be realized.
- The technical data also supports a long-term bullish outlook.
- Meanwhile, the network has seen a surge in activity which is reflected in the increase in gas tariffs.
It appears that the price of Ethereum is set for a significant increase as the much anticipated ETH 2.0 update is expected to launch in less than two weeks.
ETH 2.0 strengthens the bullish outlook behind the Ethereum price
Scalability has been one of the main disadvantages inhibiting the Ethereum network, hence the need to introduce features to rectify these challenges.
Serenity is the last step to increase the usability of the network and allow it to become the “computer of the world” as envisioned by its founder Vitalik Buterin. This protocol update will integrate proof-of-stake and other features that will improve the speed of the blockchain while maintaining its security.
Another important feature is sharding, which according to blockchain service provider Consensys will significantly increase the throughput the Ethereum network can process.
“Shard chains are a scaling mechanism in which the Ethereum blockchain is“ divided ”into 64 different chains, which allows parallel transactions, storage, information processing. At its most conservative estimate, it will allow 64 times more throughput than Ethereum 1.0, but is designed to be able to handle hundreds of times more data than Ethereum 1.0. “
Ethereum 2.0 by Hsiao-Wei Wang
As Ethereum moves away from proof-of-work and enters a new era of proof-of-stake, market participants will need to hold 32 ETH to reap the staking rewards. This factor could trigger a spike in demand for the smart contract token, subsequently affecting its price action.
A further upward advance on the horizon
Ethereum’s weekly chart shows that its price action has developed a double bottom pattern over the past couple of years. After the recent break of the 78.6% Fibonacci retracement level, it looks like ETH could rise towards the 23.6% Fibonacci retracement level at $ 1,100.
But first, it should cut three more resistance barriers represented by the Fibonacci retracement levels of 61.8%, 50% and 38.2%. These hurdles are $ 600, $ 750, and $ 900 respectively.
ETH / USD weekly chart
The Ethereum bulls don’t seem to show signs of fatigue. If buying pressure continues to rise at the current rate, the smart contract token could be poised for new all-time highs within the next year.
It is worth mentioning that the cryptocurrency community has grown worrying whether the Ethereum Foundation will be able to reach the 524,000 ETH threshold required for the launch of ETH 2.0 on the mainnet. Otherwise, it could have serious consequences on the Ethereum price as it could invalidate the bullish outlook.
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