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Ethereum has surpassed an important milestone, reaching its highest price level since the end of December 2021, at $4,012. This significant increase is recorded just before the long-awaited Merge upgrade to Proof-of-Stake (PoS) within the altcoin community. The development has created great excitement and anticipation among Ethereum owners.
Ethereum Breaks Through $4,000!
With Ethereum surpassing the $4,000 mark on major cryptocurrency exchanges like Coinbase and Binance, there has been significant activity in the altcoin market. This return above the levels seen since the end of 2021 indicates Ethereum’s strong performance.
Ethereum’s transition from Proof-of-Work (PoW) to Proof-of-Stake (PoS) occurred during a significant developmental milestone known as the Merge. The next important step is the introduction of proto-danksharding with EIP-4844, part of the upcoming Dencun Hard Fork scheduled for March 13. This development is seen as a crucial step towards making Ethereum a more scalable and efficient Blockchain.
Data shows that approximately half a billion dollars worth of Ether has been burned in the last thirty days. This contributes to a reduction in Ethereum’s circulating supply and lessens the selling pressure on the platform, which is considered a positive development for ETH holders.
What Do Technical Indicators Say About ETH?
It seems that Ethereum is boosting its prices by drawing support from recent rallies in the altcoin market. In particular, a target of $5,000, close to the peak level of $4,936 seen in December 2021, is becoming apparent. Technical indicators, such as the moving average convergence/divergence (MACD) and Awesome Oscillator (AO), support Ethereum’s upward trend and suggest the altcoin could climb even higher.
However, if prices fall below the 38.2% Fibonacci retracement level with a daily candlestick close at $3,307, this bullish thesis could be invalidated. In that case, a pullback to around the psychologically significant support level of $3,000 could be expected.
Spot Ethereum ETF Remains a Hot Topic
Another significant issue is whether Ethereum will be classified as a security or a non-security asset. As attorney Jake Chervinsky points out, it seems unlikely that the SEC will classify Ethereum as a security, as this could conflict with the jurisdiction of the Commodity Futures Trading Commission (CFTC). However, the CFTC’s definition of Ethereum as a commodity could reduce the risk of conflict between the two agencies.
A key outcome of this situation is whether the SEC will approve a Spot Ethereum ETF in May. The approval of a Spot Ethereum ETF could be a major catalyst for Ethereum owners and increase institutional capital inflow. In this case, Ethereum’s position as the second-largest asset by market value could be further strengthened with the ETF’s approval.
