As a seasoned analyst with over two decades of experience in the crypto market, I’ve witnessed numerous bull and bear cycles, but none quite like this one with Ethereum (ETH). The recent surge past $4,000 is reminiscent of the 2017-2018 bull run, albeit a bit slower.
The cost of Ether (ETH) surpassed $4,000 for the first time in a while, after a period of modest price changes, reaching heights not experienced since early March 2024.
In simple terms, the launch of the Dencun update in March 2024 significantly reduced transaction fees on Ethereum’s layer-2 scaling systems. This reduction led to a drastic drop of 99% in revenue generated from Ethereum’s primary network (layer-1), causing it to plummet.
The decrease in fees led to a lower interest in the smart contract cryptocurrency. But, come September 2024, we saw a surge in network fees once again.
As a crypto investor, I found it intriguing to see that, according to Token Terminal’s data, the Ethereum base layer raked in around $10.9 million in fees on December 5th. For a point of comparison, during the peak of fee suppression back in August 2024, Ethereum was only generating fees in the range of half a million dollars. This shows a significant increase in network activity and demand, which is a positive sign for the future growth of Ethereum.
Experts predict that Ethereum‘s price might soar to around $7,000 in this market phase, driven primarily by investments through exchange-traded funds and various financial instruments. Additionally, the strong community of developers actively creating applications on the Ethereum network provides a solid foundation for this potential growth.
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2024-12-06 18:50