As Bitcoin achieved a new all-time high (ATH) of $72,710 on March 11, Ethereum price ascended above $4,000 for the first time since December 2021.
Investors are hopeful for new all-time highs this week, considering Ethereum price at $4,030. Establishing higher support above $4,000 would prop the token for the next move up amid positive sentiment and an upcoming protocol upgrade.
Beyond the generally positive market sentiment, several unique factors enhance Ethereum’s outlook. This analysis will delve into some of the key market movers and anchors investors are riding on to achieve maximum benefits from Ether in the long run, particularly in the bull market.
1. The Dencun Upgrade
What is the Dencun Upgrade?
The Dencun upgrade is a major upgrade also known as a “hard fork,” which introduces significant changes to Ethereum’s consensus and execution layers.
Notably, it incorporates ephemeral data blobs (protodanksharding) through EIP-4844, aimed at reducing Layer 2 transaction fees.
Why is it Important?
Dencun enhances scalability and efficiency, crucial for Ethereum’s growth.
2. Market Sentiment and FOMO
The crypto market sustained a solid bullish structure since the beginning of Q4 last year. Interest in crypto assets grew exponentially as the dream for the first spot Bitcoin ETFs in the US materialized.
Bitcoin set out on a trajectory to a new all-time high, buoying the entire market. Altcoins led by Ethereum followed in BTC’s footsteps rising to new levels, some to new record highs.
The enhanced sentiment can be attributed to the Bitcoin halving in April, which will significantly shrink supply while demand continues to rise. Due to the correlation between BTC and ETH, a bullish Bitcoin often means a parabolic rally in Ethereum price.
3. Spot ETH ETF
If approved the flow of money into Ethereum investment products will grow drastically as witnessed with Bitcoin ETFs. Increasing demand for the token while supply holds steady or falls, could ignite a rally big enough to send Ethereum above $10,000.
