On August 7, Ethereum crossed above $3K in an ongoing crypto market rally, hitting a three-month high.
ETH Is Breaking Out
The past few days have been interesting for the crypto markets. Talk regarding dueling amendments to a cryptocurrency tax reporting requirement in the United States bipartisan infrastructure bill being passed in Congress has been swirling around. While industry pundits suggest one amendment supported by the White House could deal a big blow to the crypto industry, markets are seemingly unfazed.
The price of ethereum blasted past the $3,000 level on Saturday for the very first time since May. The world’s largest altcoin by market value was able to break out of the trading range it had been stuck in the wake of the successful activation of the latest hard fork upgrade dubbed “London”.
This is an Ethereum blockchain upgrade that introduced several improvements to the protocol. The Ethereum Improvement Proposal (EIP) 1559 is undoubtedly the most important part of London as it has tweaked the fee generation mechanism leading to a portion of the base fees being burnt.
Since the launch of the upgrade on Thursday, approximately 2.70 ETH is being burnt every minute according to ether chain. The total amount of ETH removed from circulation in the past two days or so is roughly 8,968 ETH, worth a whopping $28 million based on the current ETH price of around $3,137.56.
While ETH is still well below its lifetime high of over $4,356.99 posted on May 12 during the crypto market’s biggest rally to date, the price of the token has not been this high in three months. The king altcoin has gained more than 13.19% over the past 24 hours.
From a technical perspective, ETH’s move above $3,000 is an encouraging sign. If the crypto asset is able to flip the psychological level into support, it will likely play a key role in helping it advance further.
Although there is a technical reason to be leaning bearish in the mid-term based on historical trends, the odds favor the bulls in the short term.
A Landmark Year For Ethereum
Ethereum has been enjoying significant changes in the past year. The cryptocurrency is witnessing mainstream adoption, with Wall Street players including Goldman Sachs now offering their clients ETH products.
But perhaps the most profound change is the London hard fork which was recently shipped. Following the rollout, Ethereum founder Vitalik Buterin is pretty confident about the forthcoming development in the network which involves merging Ethereum mainnet and the ETH 2.0 beacon chain.
Buterin told Bloomberg on Aug. 5 that the London update is “proof that the Ethereum ecosystem is able to make significant changes” and that it “definitely makes me more confident about the merge”.