Ethereum price rallies once again after recent flash crash
Ethereum is showcasing gains of nearly 30% over the course of the last month
- Ether's short-to-medium-term monetary outlook appears to be quite strong at the moment, according to experts.
- ETH continues to be faced with monetary resistance around the AUD$2,650 range.
- The total value locked (TVL) in the DeFi ecosystem is $56 billion.
After dropping to a relative low of AUD$2,700 on 18 April, the world's second-largest cryptocurrency proceeded to forge a steady recovery, currently trading at AUD$3,000, thereby showcasing a surge of nearly 10% over the last 72 hours.
Commenting on the premier altcoin's future outlook and its price action in general, Sebastian Bürgel, founder and president of HOPR, an Ethereum-based privacy-preserving messaging protocol, told Finder that Ether's near-term future looks quite bright especially with the London hard fork looming large on the horizon. He added:
"The upcoming London fundamentally changes the economics of Ethereum with the keenly awaited EIP1559. EIP1559 is an overdue correction in favour of the users of Ethereum as it might absorb peak load without significant increases in transaction fees but we will have to wait for other layer-2 solutions and ETH2 developments to increase transaction throughput."
And while some miners may be upset with the proposed upgrade — since it stands to cut up to 50% of their block rewards — Bürgel believes that the transition was inevitable and that EIP 1559 is a good first step to phase out mining entirely with ETH 2.0. Lastly, he pointed out that a crypto-economic network like Ethereum has to constantly balance the security budget required to keep the system secure and what miners are (over)charging.
Ether showcasing signs of stability
Providing her views on Ether's fundamentals, Marie Tatibouet, chief marketing officer for cryptocurrency exchange Gate.io, told Finder that the currency's closest major resistance threshold lies around the $2,050 range but overall, market momentum continues to remain strong. She further added:
"ETH isn't overvalued yet, so a further growth back into its all-time high levels is definitely on the cards. Also, do keep in mind that the DeFi market is currently >$50B, and the way this sector is growing far outpaces the growth of the overall crypto market. This is why I believe that both the short-term and long-term future looks pretty bright for Ethereum."
When asked about the network's growing gas fee and congestion-related woes, Tatibouet pointed out that the only reason why transactions cost more on Ethereum than competitors like Binance Smart Chain (BSC) is that they are not compromising on decentralisation. "As things stand, if you want decentralisation, then there is definitely a price to pay. It will be interesting to see how they mitigate these issues with Ethereum 2.0," she added.
Lastly, there is no denying that Ethereum has transformed into the core development platform of the crypto universe, with the ecosystem boasting the largest crypto developer base in the world. Furthermore, thanks to the continuous innovation taking place across the DeFi sector, and the rapid mainstream adoption of NFTs, it stands to reason that investors will continue to remain bullish on ETH at least for the foreseeable future.
Disclosure: The author owns a range of cryptocurrencies at the time of writing