- From the Ethereum whitepaper
- Ethereum’s all-time high
- Is another breakout on the cards for Ether?
- Ethereum 2.0
- Ethereum price prediction
Ethereum has been struggling since reaching its all-time high in November 2021. Along with bitcoin and the crypto market, ether has plummeted over the recent months. But it is now finally showing signs of recovery.
Experts are suggesting that the second largest cryptocurrency can sustain this bull run and race to the $4,000 mark again. However, these ambitious price predictions come with warnings of a potential crash.
See more: Will ethereum rise again
From the Ethereum whitepaper
The Ethereum introductory paper was published in 2013 by its co-founder, Vitalik Buterin. The network was created to take cryptocurrencies further than just a store of value: the Ethereum team wanted to develop greater utility.
Since the project’s official launch in 2015, it has spearheaded the decentralised finance industry with the myriad of projects built on its network. The blockchain also made the use of NFTs mainstream through the ERC-721 token standard.
The latest whitepaper said: “What is more interesting about Ethereum, however, is that the Ethereum protocol moves far beyond just currency. Protocols around decentralised file storage, decentralised computation and decentralised prediction markets, among dozens of other such concepts, have the potential to substantially increase the efficiency of the computational industry and provide a massive boost to other peer-to-peer protocols by adding for the first time an economic layer.”
The whitepaper concludes with: “Finally, there is also a substantial array of applications that have nothing to do with money at all.”
Ethereum’s all-time high
Ethereum reached its new high after the expiry of options contracts worth $1bn (£747m). There was motivation for the bulls to keep the price above $4,200, as analysis showed that this would result in more than $200m in profits. The strike price did vary, with some bulls placing optimistic bets at $5,000.
The options expiry date was not the only driver of the ether price. The launch of the first bitcoin futures has paved the way for ether alternatives. The CME group launched its own Ether future in February 2022 and it was met with high demand. Trading volume exceeded $30m within the first day.
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The Ethereum blockchain had seen more good news in November as a new update was activated successfully. The update focused on upgrading validation processes on the network, taking steps for the blockchain to shift towards a proof-of-stake model next year.
Ethereum’s busy November reflected a period of massive growth for the blockchain. The total transaction fees surged from $321m in Q3 2020 to $1.96bn in Q3 2021, according to analyst Ben Giove’s Bankless newsletter. The total transaction value also grew, reaching $536.48bn in Q3 2021, a year-on-year increase of 398%.
But these highs did not last for ether as December presented new challenges and the cryptocurrency fell to a low of $3,628 by the end of the year.
Is another breakout on the cards for Ether?
The ETH price had a weak Q4 across the board, which spelt trouble for the crypto markets. By 22 January 2022, the coin was trading at a low of $2,417.68. However, a slight recovery was made and on 7 February the coin was up 4% from its previous close, at $3,128.22.
Ethereum has managed to continue this momentum in recent weeks. On 31 March, ether was sitting at $3,433, up by 13% in a recent seven-day period.
Rakesh Upadhyay, trading expert and nftgamef.com contributor, said: “Ether’s price analysis shows that the bulls have overpowered the bears. If buyers defend the breakout level from the triangle, the pair could rally toward $4,000. This positive view will invalidate in the short term if the bears pull and sustain the price below the 50-day SMA [simple moving average].”
FX Street also reported that the ether price is showing signs of a “further uptrend” that will break out over the $4,000 mark. It wrote: “All in all, the outlook for ethereum price looks bullish with just a minor retracement. If the directional bias remains bullish as it has for the past two weeks, there is a good probability that ETH will revisit $4,000.
The financial publication does warn that if Bitcoin “crash[es] the party”, ethereum could follow the same trend. In a highly bearish case, the ethereum price would be knocked down to the 50-day SMA and drop to $2,584.
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There is a transformation taking place on the Ethereum blockchain. It is shifting towards a proof-of-stake model, which it is hoping will reduce gas fees and energy usage, while improving transaction speeds. This migration is well under way and a full launch date was given of 2023.
The Ethereum 2.0 update is predicted to have a positive impact on ether’s price. Decrypt wrote: “More scalability means more usage, which, in turn, means more demand. Which—at least in theory—should propel the price of Ethereum to new heights.”
Surojit Chatterjee, chief product officer at Coinbase, is similarly optimistic about the upcoming Ethereum updates. He said major Ethereum scaling improvements ere coming soon, and that the blockchain would see substantial growth during 2022.
Ethereum price prediction
ETH price predictions vary depending on who you ask, but there is a consensus that the bullish trend will continue. A panel of 50 fintech specialists at Finder gave their ether price prediction and forecast, with more thanr half (52%) believe now is the time to buy, while a further 30% think you should hold.
The panel vastly agrees that the move to proof of stake will have a positive effect on ether’s price. More than three quarters (78%) said it will increase in value, with only 10% suggesting it will dip.
Martin Froehler, chief executive of Morpher, who sat on the panel, said: “The move to proof-of-stake, DeFi, NFTs, and Ethereum’s low inflation rate combined with huge network growth rates will lead to higher demand, and thus higher prices for Ether.”
Wallet Investor’s ETH price prediction describes it as an “awesome long-term investment”. Its ethereum price prediction for 2022 suggests it will climb from $4,000 in July to $5,000 by the end of December. Its prediction for the end of 2025 is that the cryptocurrency will reach $12,000.
DigitalCoinPrice’s ethereum price prediction for 2025 is less optimistic, reckoning the cryptocurrency will be worth only $6,559. It suggests ether will hit $15,402 by the beginning of the next decade.
CoinPriceForecast says ether will climb from $4,879 by the end of 2022 to $10,153 at the end of 2025. Its ethereum price prediction for 2030 is $18,384.