Ethereum price: are we still in a bull market?


Ethereum is still down more than 44% from its all-time highs, but it has also pumped nearly 31% from its lowest point from the high. So are we still in a bull market and can Ethereum hit another all-time high?

Fast facts:

  • Ethereum has exited trading at a significant rate over the past year.
  • Crypto exiting trades typically represents a purchase that just happened and the withdrawal of the crypto to a personal account. wallet.
  • Over 1.4 million Ether left trades in the last 30 days.
  • Long positions in Ether far outweigh short positions, accounting for over 75.8% of positions.
  • An upgrade to Ethereum, known as Ethereum 2.0 Where Eth 2.0, promises faster and cheaper transactions, which would help open up the network to a wider range of people.
  • More people using the network could lead to higher prices.
  • Some have argued that Ethereum is on the same trajectory as Bitcoin and could reach up to $ 20,000 in this cycle if the bull market continues.
  • All cryptocurrencies are always directly correlated with Bitcoin and largely dependent on the performance of Bitcoin.

Exchange flow

One indicator of the overall health of Ethereum is the direction in which the supply is heading. Generally speaking, when cryptos are sent to an exchange, it is for the purpose of selling the asset. When the opposite happens and the crypto is removed from an exchange and sent to another wallet, it is most likely due to a recent purchase.

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According to Viewbase, a site that tracks exchange flow data on the top 43 exchanges, Ethereum’s supply on exchanges has declined significantly over the past year.

Provided Ethereum on the top 43 exchanges in the past year.

Given the recent ramp-up ahead of the April sell-off, the decline in supply on the exchanges over the past year is not too surprising. But over the past month, the supply of ether on the exchanges has also plummeted. Over 1.4 million eth has been removed in the past 30 days.

Long and short positions

Another factor related to trading is long positions versus short positions. There are currently much larger long positions in Eth than short positions.

In the last 24 hours, there have been 327,238 Eth in long positions compared to 104,197 Eth in short positions on the Bitfinex exchange. In other words, long positions in the last 24 hours are worth around $ 757,657,413 million, while short positions are worth around $ 241,248,356 million. Long positions represent 75.8% of Ethereum trades on the Bitfinex exchange.

Ethereum 2.0 upgrade

Long positions in the exchanges and the fact that a lot more Ethereum is leaving the exchanges than is sent to them are good signs for a continued bull market.

But an even better indicator of Ethereum’s short and long term performance is its pending upgrade which will likely increase its usage and potentially increase its price as well.

Ethereum is expected to undergo a massive change over the next six months to two years when it switches from the Proof of Work (PoW) consensus model to the Proof of Stake (PoS) consensus model and implements sharding.

This model, combined with the use of sharding, will allow much faster and cheaper transactions. This is extremely important because Ethereum transactions are currently too expensive for small payments and transactions to be made.

Transaction fees on the Ethereum network have sometimes exceeded $ 70. The current fee to send a coin to the network is less than $ 10, but that means any coins held in a wallet with a dollar value less than the fee cannot be moved without purchasing more Ether to fund the transaction.

This makes microtransactions and using Ethereum as something similar to an app like Venmo or Zelle unrealistic. The future upgrade will slowly reduce transaction fees and open up the platform to all types of individuals rather than the wealthier traders or people looking to divest their farm. This increased use of a wider range of people could lead to higher prices.

Where can the price of Ethereum go?

Raoul Pal, former Goldman Sachs and founder of Real Vision, argued that Ethereum can hit Bitcoin’s previous record of $ 20,000 in this cycle alone.

This has been taken into account by looking at the network growth and market capitalization of Ethereum relative to that of Bitcoin. So far, Ethereum has grown faster, reaching a market cap of almost $ 100 billion with far fewer addresses.

Ethereum from 2017 until just before the April crash also shares nearly exact prices as Bitcoin does during its 2013 to May 2019 lifespan.

Another factor is that almost all other cryptocurrencies are following in Bitcoin’s footsteps. This is largely due to the fact that most of the people have not yet understood these technologies and therefore group all cryptocurrencies together.

This makes all other cryptos head to Bitcoin because it is the most well-known. Until more people are educated on the different types of cryptocurrency, their price movements will likely follow those of Bitcoin. This makes a bet on almost any crypto really just a bet on the performance of Bitcoin until those assets become uncorrelated.

With Bitcoin’s recent uptrend and similar data in exchange flows (-1.49 million BTC last month) and long and short positions (96.8% long on Bitfinex), the crypto market looks healthy. If Bitcoin continues to pump, other cryptos, especially Ethereum, also appear poised to continue their bull market.

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