Over the past few weeks, people had suspected that the Ethereum price was probably about to undergo a major correction after an impressive rally. However, ETH proved its critics wrong today. The new week has also started on a positive note and the cryptocurrency has reached a new all-time high of 4,780 USD at the time of writing this article.
This is already the fourth peak in the price reached in a period of only 30 days. Do we stand at the beginning of a period of rising prices? Is it worth it to buy ETH at the moment?
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What explains the current Ethereum price high?
In this case, there is more than one reason. For one, the good price of Bitcoin is also backing Ethereum purchases. However, political factors also play a role. A strategy change by U.S. authorities, for example, is helping the token. Only a new Bitcoin ETF makes the coin available to many traders and investors. This wind shadow is also being used to Ethereum’s advantage. More and more investors are stocking up.
A further important point is the Altair upgrade, which came online on October 28 – only one day before the last all-time high. In terms of the network’s infrastructure, ETH 2.0 is among the most important updates. The introduction of the Beacon Chain, which switches the network to the proof-of-stake consensus mechanism, has strengthened the rules for inactive or offline accounts.
Furthermore, the update also makes the network greener, faster and reduces transaction fees. The more advanced ETH 2.0 version is scheduled for completion in the next two years.
There is still also a fear for many young people of jumping into the crypto market too late or not at all, and consequently missing out on future technologies. A survey by the U.K. Financial Services Authority found that 76 percent of those surveyed said they would make an investment in Ethereum and the like as they felt they were competing with friends and family. A whopping 69 percent mistakenly think cryptocurrencies are a regulated asset.
Is the fund on Ethereum coming now?
Not long ago, the first Bitcoin fund was launched in the U.S. and the experts are already starting to speculate which token will probably follow its big brother next. An IPO in the U.S. in October 2021 is regarded as an important milestone for the global crypto market. The industry has been seeking approvals for such an index fund in the US since 2013.
However, the US regulator SEC constantly postponed the approval, while trading was already possible in Europe and Canada. Following this, investor Lark Davis declared on Twitter that people can already wait for the announcement of an ETH ETF while this is just the beginning.
The fact that Ethereum follows Bitcoin in this is only logical, according to “FX Empire”, because it is the cryptocurrency with the second highest market capitalization. As early as the summer, investment companies such as ProShares and VanEck had already submitted regulatory filings to the SEC. They were withdrawn shortly thereafter, however. Nevertheless, some applications for Ethereum ETFs are still open.
Where will the ETH price go from here?
As with the entire crypto market, the digital asset value also applies to ETH. Therefore, no reliable Ethereum price forecasts for the future exist. In the past, however, the cryptocurrency has demonstrated bullish behavior that could defy short-term price drops.
As a result, the digital currency had to accept price losses again and again recently, primarily due to uncertainties in the stock markets. Blame for this is certainly also the instability of the extremely indebted Chinese real estate group Evergrande, causing turmoil on the stock exchanges worldwide. In September 2021, for example, Ethereum lost almost 10% of its market value.
During the same month, the Chinese central bank was critical of all cryptocurrencies. According to it, crypto trading is to be banned altogether in the country. This was another reason why the price dropped by 7%.
As the wave of new highs now shows, however, the ETH price can also quickly recover. At the same time, it remains to be noted that external factors will continue to have an important impact on the price of digital money in the future.
However, the potential of Ethereum is seen as very large due to the ecosystem behind it. In the opinion of most analysts, the current all-time high will be surpassed in the near future. The renowned magazine Forbes says that a price increase to 20,000 US dollars is feasible by 2025. That would represent an increase of almost 400% on the current price.
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Will Ether overtake Bitcoin?
At the moment, Bitcoin still has the highest value, but it has a falling tendency. Earlier this year, Bitcoin still represented about 70% of the value of all cryptocurrencies. By May, it was only just under 50%. In contrast, Ethereum managed to boost its market share from 10% to just under 15%. Despite existing connections between the prices, altcoins like ETH are more and more managing to uncouple themselves from the price of bitcoin.
Fans of ethereum hope that the number 2 on the market may one day make the leap to the throne. This kind of event is called “flipping”. Currently, the good price shows that there is huge potential in ETH. In fact, Dan Morehead, CEO of Pantera Capital, expects the price to reach US$100,000 by the end of this decade. Would the price of BTC remain stagnant or increase only slightly, Ethereum would thus be in first place.
Should you buy ETH immediately or wait?
The past prices and balances prove that traders were able to make money by trading and holding Ethereum until today. If you have missed investing until now, this may be the next best time. There is no predefined pattern for price movements in the future, however.
Looking at the past, it is clear though, that the price gains in the case of ETH over a longer-term period are hard to deny. As a result, it may be worth investing now as well. It is important to understand, however, that any planning should take place over a longer period of time. In the beginning, newcomers should start with small amounts in order to get an appreciation for the market and to limit the risk of losses.
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