Ethereum is proving to be particularly resilient in the face of the turmoil caused by the SEC. The SEC has gone after big market fish, Binance and Coinbase. So yes, the market fell sharply due to repeated attacks from the US authorities, but ETH seems to be recovering quickly from this storm.
The crypto is already showing bullish signals that could send it skyrocketing in value before long. Ethereum raised hopes among holders when it hit $1900 a week ago. The turmoil the exchanges are in could, in fact, have a beneficial effect on the value of ETH, and we explain why!
SEC Maintains FUD in Crypto Markets and Ethereum Could Benefit
The price of ETH rebounded this past Tuesday after a market correction initiated by the SEC. It appears that investors have shifted their funds to less volatile and more solid cryptos, such as Ethereum, compared to its altcoin counterparts.
The data from the blockchain indeed shows a substantial recovery in activity on Ethereum, with staking of the token going up.
Ethereum staking, useful for minimizing losses
Ethereum's staking function makes it possible to allocate its tokens to the liquidity pool which ensures the smooth running of transactions on the blockchain. In exchange, the network rewards stakers with passive income in the form of new ETH tokens.
And it seems that this new feature, enabled by the recent Shanghai update of ETH, is appealing. ETH has seen its number of staked tokens explode in just a few days.
While this functionality exists on many other altcoins, ETH remains a crypto that can be considered a safe haven in the crypto market, because it has very powerful technology, has been resilient over the years, and ranks second of the leaderboard, just after BTC.
The staking of many ETH tokens reduces the amount of ETH available for sale. This can therefore create a leverage effect where the supply of tokens becomes less and less , with demand remaining the same, or even increasing.
Investors are starting to fight over Ethereum tokens
Speaking of demand, it seems that it is indeed increasing. When we look at the buy orders made on Ethereum, we observe a gradual increase in demand, surpassing the supply of ETH tokens.
We therefore find ourselves with our good old principle of supply and demand which should have its effect shortly. The price of Ethereum is expected to increase rapidly, tempting investors to raise their purchase price for faster acquisition!
Currently, there is already a shortage of ETH supply to the tune of 68,310 tokens. The price increase is therefore likely to accelerate as buyers increasingly compete for the valuable tokens.
Ethereum soon to 2000 dollars? It is possible but...
When looking at all of these factors combined, a $2000 Ethereum seems like just a formality . But beware, the current situation is more than unpredictable with regulatory authorities on a war footing.
In addition to this, Ethereum will still have to come up against its resistance located at 1900 dollars and formed last week. According to data from IntoTheBlock , there are currently over 3 million addresses holding nearly 5.3 million ETH and buying it at a price of $1905 or less.
It will therefore be necessary to pass this resistance to hope to see Ethereum again above 2000 dollars. If this resistance holds, ETH may experience a drop to $1795, and further down to $1650 if the support level breaks.
But don't panic, for now, Ethereum seems on track to break its caps. We advise you to monitor its course in the coming weeks, to find out if the current trend has got the better of the bears.
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