For the first time since March 1, the price of Ethereum surpassed $3,000 earlier this week, but it immediately dropped below $3,000 on Wednesday.
Over the previous week, Ethereum has outpaced Bitcoin as expectation grows for a major software upgrade. It’s being dubbed “the merging” or “Ethereum 2.0” by investors and developers, and it’s likely to happen in the coming months.
It will alter the sequence in which Ethereum transactions are processed, making it more efficient and long-term viable for wider adoption. Experts are waiting to watch how investors and firms who create technology on Ethereum’s platform react to the modifications until that happens.
The cryptocurrency market, according to experts, is reflecting the increased volatility that comes with war. Other variables, such as the crypto market following the stock market, more mainstream use, and recent price slumps, are all contributing to the current state of crypto pricing.
Even before the conflict in Ukraine, Ethereum’s volatility was fueled by rising inflation, the stock market’s worst month since March 2020, and persistent signs that the Federal Reserve will begin hiking rates at its next meeting in March to combat inflation.
More crypto legislation, as well as the idea of developing government-issued digital money, has piqued the curiosity of government authorities. Bitcoin’s price has been on a similar downward trend recently.
All of this has contributed to Ethereum’s rocky start to the year, with its price dropped below $2,200 in January, the lowest it has been since July 2021. This week, the price of Ethereum has fluctuated between $2,800 and $3,100.
Ethereum has traded between $2,100 and $4,000 in the days since reaching a high of $4,100 on December 27. Despite the poor start to 2022, many analysts remain optimistic, anticipating that Ethereum’s price would touch and beyond $12,000 this year.
Despite the latest drop, Ethereum is still holding up well in the run-up to 2021. When Ethereum surpassed $4,850 on Nov. 10, it achieved a new all-time high, which it maintained into December before reversing at the end of the month.
Despite the late drop, Ethereum ended the year much above where it began: in January 2021, the price of Ethereum was just over $1,000.
Bitcoin, like Ethereum, has slowed in the last month following a robust November; Bitcoin reached a new all-time high of $68,000 on November 10th. The price of Bitcoin and Ethereum will almost certainly continue to fluctuate in the future, and experts’ advice for investors remains same.
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