Ether prices rallied today, climbing to their highest in over a month as multiple bullish factors drove the digital asset higher.
The world’s second-most valuable digital currency by total market value reached more than $1,575 today, TradingView statistics show.
At this point, the cryptocurrency had climbed more than 15% in roughly 24 hours and was trading at its highest point since approximately June 11, additional TradingView data reveals.
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
Impact Of The Merge
When explaining these latest price movements, several analysts anticipation surrounding an upcoming event known as The Mergein which the Ethereum network will shift to using a proof-of-stake consensus mechanism instead of using proof-of-work.
This event will represent a significant milestone for Ethereum, as it will drastically reduce the number of tokens issued by the network every year, lowering the figure by 90%, The transition will also cut Ethereum’s total power usage by more than 99%,
Individuals making up the network’s community have described the sharp decrease in token issuance as amounting to a “triple halving” in terms of its impact.
Tim Enneking, managing director of Digital Capital Managementspoke to this event, stating that it “has clearly been the driving force behind ETH’s move up – and the significant recovery in the BTC/ETH cross rate.”
“However, it’s not the Merge per se which drove ETH up fairly dramatically over this past weekend, but rather the quite specific date of September 19 which was released on July 14 or 15, depending on where one was located.”
In the message, Beiko provided what he described as a “planning timeline” that offered an idea of when key developments would take place.
This tweet had a substantial impact on the ether markets, said Enneking, noting that the “timing” of the message enabled “ETH to make a major move during an as-usual slow trading weekend.”
Brett Sifling, an investment advisor for Gerber Kawasaki Wealth & Investment Managementalso commented on Ethereum’s upcoming merge, as well as how it could impact the ether token.
“When an investable asset has a positive future catalyst, you typically see that asset rise as we get closer to the catalyst date,” he noted. “This is a possibility that could happen with Ethereum, as more people pile into it in anticipation of the event.”
However, Sifling focused that there is still uncertainty surrounding when this upgrade will take place and how the timing will affect the markets.
“This, ‘merge’ has been ongoing for quite a while and I would not be shocked to see further delays,” he stated.
“This builds more risk into the theory, as we’d expect to see people bail out of Ethereum position and allocate to different areas if they are forced to wait even longer for the positive catalyst.”
Analysts also pointed to the changing mindsets of investors as being a bullish development, stating that their outlook has been getting more optimistic as of late.
Marc Bernegger, cofounder of crypto fund of funds AltAlpha Digitaloffered his perspective on this situation.
“I think after the recent crash we are moving from an extremely bearish back to a more positive market sentiment,” he stated.
Joe DiPasquale, CEO of cryptocurrency hedge fund manager BitBull Capitalalso weighed in, emphasizing bitcoin’s recent price resilience.
“The fact that Bitcoin has remained above $20,000 for a while has given the market some confidence in a potential reversal and with Ethereum’s merge coming up, the narrative around the second-largest cryptocurrency by market cap is relatively bullish,” he stated.
The ether token is also benefiting from investors who are playing the long game when selecting digital assets, said Bernegger.
“Besides the anticipated merge, most traditional investors are focusing on digital assets with a sustainable long-term value which brings additional assets into Ethereum,” he stated.
“After we saw many so-called Ethereum competitors having issues recently, I expect more reallocations from these assets into Ethereum.”
Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether, EOS and sol.
Credit: www.forbes.com /