Why Is The Price Of Ethereum Going Up

Why Ethereum Price is Crashing and What Can Abort its Autumn

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Despite the annunciation of the Ethereum merge, the toll of the largest altcoin in the world is crashing. However, an Ethereum increase in price following the new network upgrade? Permit’s have a wait.

Ethereum Price Correction

Ethereum and the broader cryptocurrency markets take been descending since 2022 – amidst the economic crisis following the pandemic, increasing inflationary data and interest hikes. In November 2021, Ethereum (ETH) reached an best high (ATH) of $4,900.

In the nautical chart above, Ethereum (ETH) has witnessed a significant price correction since 13th September 2022. From $1,748 on the 13th, the largest altcoin plummeted to under $one,300 on September 18th – equating to a 25% price correction in under a week. Currently, Ethereum is trading at $1,350 – 72% below its November highs.

Surprisingly, the sudden autumn in the price of Ethereum has corresponded with the network’s new merge update – which will see Ethereum shift from a Proof of Piece of work (Prisoner of war) to a Proof of Stake (PoS) consensus. Simply why has the token corrected despite the proclamation of the merge?

What Has Ethereum Corrected?

On September 15th 2022, Vitalik Buterin, the creator of Ethereum,
tweeted
announcing the successful launch of the Ethereum verge. Before, Ethereum’south network was facing trouble relating to scalability and slow transaction processing times. The new merge is expected to make the network a faster, cheaper and more scalable solution.

Despite the launch, Ethereum has corrected right after the proclamation. Ane of the reasons for this is the ‘purchase the rumour, sell the news’ phenomenon. In trading, this means that a cryptocurrency’due south cost tends to get upwards after positive announcements relating to a cryptocurrency.

In the context of Ethereum, the token has recently delivered returns correct before the merge news announcement. Betwixt Mid-July to Baronial 14th 2022, Ethereum rose from $1,000 to well-nigh $2,000 – a 2x cost increment. This was the get-go sign of a solid upwards movement in the price of Ethereum since April 2022.

Many analysts believe that the contempo price correction is due to Ethereum’s already inflated cost tag acquired past people buying the rumoured way alee of the actual announcement.

Moreover, the SEC (U.S securities and substitution commission) recently announced that staked cryptocurrencies might exist subject to federal securities regulation. This announcement was made by Gary Gensler, the SEC chair, on 15th September 2022 – just a few hours after the Ethereum merge was finalised.

Since the Ethereum merge volition make the token a Proof of Stake cryptocurrency, many correlated the timing of the SEC announcement with Ethereum’south new development. Yet, the SEC conspicuously stated that the annunciation does non revolve effectually any particular cryptocurrency.

These factors may have led to a brusk-term bearish sentiment in the market, but tin Ethereum go 1 of the
best altcoins
to invest in the futurity?

Can Ethereum Go Up?

As stated above, the ‘buy the rumour’ sell the news’ miracle may have resulted in the instant price decrease of Ethereum. Notwithstanding, the confirmation of the Ethereum news has the potential to make Ethereum one of the nigh pop cryptocurrencies to watch.

Before the merge, Ethereum was still the biggest cryptocurrency for developers to deploy decentralized applications (DApps) and NFT-based protocols. The merge aims to make the Ethereum network more than sustainable – since the platform will rely on crypto staking, which is far more than sustainable than the Proof of Work concept.

Moreover, Ethereum’southward historical price shows the token’southward strength to rebound in the long term. While past operation does not betoken future success, Ethereum’s new upgrade may invite many investors to purchase the token at a lower price.

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