$3,500 Ethereum as EIP-1559 Inches Closer?
Often enough you might find yourself wondering: what is Ethereum really and why should I bother with it?
Without boring you with too much information, Ethereum is simply a smart-contract platform that cannot be shut down. If you want to deploy a smart-contract application, you can do it with a few lines of code and voila you have yourself unstoppable code.
Since it can’t be stopped, a smart contract will be executed no matter what — even if one party changes their mind or the government bans it. In a way it is a machine which ensures that promises will be kept.
It is because of this platform that decentralised finance exists. One person can program an entire exchange with an automated market maker in his bedroom and this suddenly challenges the world’s centralised exchanges. This is the power of decentralised programming.
In the coming months, EIP-1559 will be implemented and the upgrade will be historic in its size and scope.
Let’s dig in.
Ethereum developers defend popular EIP-1559 proposal
Ethereum network developers have defended incoming changes that will burn ether tokens and cut fees paid to miners, saying they’re popular with users and could boost the cryptocurrency’s price. The planned update will change Ethereum’s fee mechanism such that it will become a deflationary asset, reducing the circulating supply as a consequence.
Check out the full story here!
Ethereum gears up for $3,000 plus
Taking a week off from crypto markets feels like missing out on a lifetime of information.
In fact, much has happened in crypto since the last newsletter (March 24), and ETH/BTC is acting as a leading indicator for what could potentially come to pass in the coming weeks and months.
ETH/BTC rallied 22% from the 0.029 trough to the 0.036 peak in 10 days. Clearly, buyers continue to step in at the 0.030 Satoshi level which remains a relevant pivot point and trading block.
The bounce also respected a 2-year long trend characterised by higher lows and higher highs — minus the trading session in December 2020 — which we will treat as a deviation off the larger trend.
As it stands, the pair has formed an asymmetric ‘W’ pattern which technically opens the door for continuation towards the highs, should gains be defended.
ETH/USD teeters on a breakthrough?
Ethereum trades above $2,000 just on the outer edge of a broad trading range.
Per the defined range, the USD pair could contract all the way to $1,736 (pivot) and remain bullish on high time-frames. A daily-close below this level could signal yet another retest of the 2017 all-time-high and would merit concerns over the platform’s potential for the remainder of 2021.
However, this scenario is less likely now than it has ever been in the context of this trading range. Ethereum is bullish and higher prices are almost guaranteed when seen in light of the technical price data and the fundamental outlook (Optimism launch, Uniswap V3, EIP-1559).
Bearing in mind that this crypto market cycle is probably passed the mid-point, it’s very likely that price-targets are both under and over-estimated since volatility historically increases in the later stages of a bull market.
Levels to watch
- $1,950 support level could be the last touch before $2,500
- $1,850-$1,750 long accumulation range
- $2,500 mid-term price target
- $3,500 mid-term price target
In another edition, we’ll discuss Ethereum’s potential USD-price tag should it ever reach the 0.1 Satoshi level. The price might shock you but for now, let’s just say that 1 Ether would become as unaffordable as 1 bitcoin currently is.
I am not a bitcoin puritan. I bet on innovation and attempt to recognise value where it exists. There is no doubt in my mind that bitcoin is playing a reality-shattering role in changing finance forever. Its immutable properties will be needed well into the future and that base-layer of certainty is necessary. But money is one use-case in a burgeoning era of a new decentralised web.
Bulls lead the way.
Catch you next time.
Read More: Ethereum developers defend popular EIP-1559 upgrade
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Originally published at https://mailchi.mp.