Ethereum Takes $150
Ethereum is finally rising, up some 7% today to retake $150 once more for the first time since November.
That’s on considerable unfiltered volumes of circa $11 billion with the daily chart looking a bit interesting.
By some stretch you could maybe see a cup and handle between December 16th and the beginning of the new year.
If that’s the case then $150 isn’t much of a resistance, but $200 might be depending of course on what bitcoin does which might hang out at $8,500 or might head for $10,000.
As a newly graduated safe haven asset , bitcoin has plenty of reasons to rise, including as a hedge from stocks which are getting maybe a bit bubbly, but why is eth rising?
The simple reason is because it fell, maybe a bit too much, with it becoming perhaps a bit too cheap considering the developments in eth.
Chiefly, decentralized finance is now a thing and is being used with things like DAI for example paying10x more in interest than a bank savings account.
That by itself could spur demand, with this model easily copyable to likewise tokenize not dollars, but say Apple stocks.
The genesis block of ethereum 2.0 is now not far away with some 13,000 validators queuing up to test out a single client testnet.
Ethereum’s inflation is also planned to stand at around 0.26% a year. That’s maybe next year or 2022 more likely, with it brought forward from the previous estimate of: in a very very long time.
That’s because devs have come up with a plan to have the current ethereum network as thefirst shard on the Proof of Stake chain, so ditching the Proof of Work chain entirely.
That’s quite a big endeavor so estimates might move, but from an investment or development perspective, this change does make many things a lot simpler.
Another reason might be that a lot of the negative aspects have now probably been priced-in, with bears maybe getting a bit too exuberant, so the market is perhaps trying to price-in potential positive aspects like people actually wanting eth to defi.
Finally, ethereum has been following bitcoin’s cycle of awareness fairly closely. So it might simply be the case that more people now know or are learning of what eth can do and presumably some of them like it.
So the currency is rising a bit for now with $200 being a good target, but obviously $324 is the target. If it can keep that, then maybe it is actually rising, maybe.
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