Ethereum regains US$3000 level. Where is it heading?

Highlights 

• Ethereum has pushed above the US$3,000 mark for the first time since February 17.
• It’s been a bumpy road so far for Ethereum in 2022, with Russia’s invasion of Ukraine fuelling volatility.
• The emergence of the metaverse and the fact that so many metaverses’ native tokens exist on Ethereum’s blockchain, means the bases are loaded for the world’s second largest cryptocurrency.

The crypto market has experienced a remarkable turnaround in the past 24 hours following a rough period triggered by escalating conflict in the Ukraine.

Amidst this, the second largest cryptocurrency by market capitalisation (behind Bitcoin), Ethereum, has pushed above the US$3,000 mark for the first time since February 17.

Does this spell the end for the crypto’s bear market? And where is Ethereum headed over the short term?

Ethereum’s Recent Performance

It’s been a bumpy road so far for Ethereum in 2022, and particularly just in the past week, its price has fluctuated between US$2,400 and its current high of US$3,022, at the time of writing. This volatility has been the result of Russia’s invasion of Ukraine, which started last Thursday clearly spooking investors and leading to selloffs across the market.

Crypto experts have also pointed towards the stock market slump and wider mainstream adoption as reasons for the market volatility.

Even before this week, Ethereum’s price had been struggling after hitting an all time high on November 16 of US$4,892. Since then, it’s been a steady decrease with the lowest point this year being US$2,212 on January 24.

Image Source: © Bashta | Megapixl.com

Ethereum’s Outlook

At the moment, Ethereum is at the whim of the wider market performance. When people begin to buy into the market again, Ethereum will go up. And make no mistake, when that time comes, Ethereum would be in a strong position to capitalise on a bull market.

Firstly, there’s the long-awaited upgrade Ethereum 2.0, which is set for release later this year although the specific date is unknown. This upgrade will not only move Ethereum’s mining protocol to a proof-of-stake consensus but it will also make its transactions faster and cost-effective.

Add to that, the emerging popularity of non fungible tokens (NFTs) and the fact that the majority of NFTs are kept on Ethereum’s blockchain. These factors bode well for Ethereum.

Finally, the emergence of the metaverse and the fact that so many metaverses’ native tokens exist on Ethereum’s blockchain, means the bases are loaded for the world’s second largest cryptocurrency.

Bottom Line

Ethereum may not be out of the woods quite yet, but the horizon looks pretty good. Some experts are predicting Ethereum will hit as high as US$12,000 by the end of the year.

Although things may be bumpy over the short term, in the longer term, its value is most likely to go up as suggested by historical price movement.

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