ETH Crosses $1,900 For the First Time Since August
ETH rallies ahead of major network upgrades
By: Owen FernauDeFi News
ETH has crossed the $1,900 price point for the first time in nearly eight months as traders continue to price in the Shanghai and Capella upgrades, which will allow ETH stakers to begin to withdraw their tokens for the first time.
ETH is up 2% on Wednesday, rising as high as $1,922, while Bitcoin and the U.S. stock market were down by less than 1%.
ETH Price. Source: The Defiant Terminal
There’s an ongoing debate about whether the Shanghai and Capella upgrades are bullish or not for ETH. Because starting next week, the Ethereum protocol will process 2,200 ETH in withdrawals each day.
On one hand, that’s $4.2M worth of ETH a day becoming eligible for sale.
On the other hand, the success of two major upgrades would mark another significant milestone on Ethereum’s roadmap, solidifying the blockchain’s status as a well-functioning technology. If the week’s price action is any indicator, traders and investors are betting on successful Shanghai and Capella upgrades next week.
Regarding ETH’s relative outperformance of BTC, concerns about the banking sector, fueled by the failures of Silicon Valley and Signature Bank, may be subsiding. BTC hit a ninth-month high of its own less than three weeks ago as the asset’s value proposition as a hedge against failings of the traditional financial system became clear. That appeal may have cooled, leaving ETH to outperform.
The ETH/BTC ratio is up to 0.068, the highest in three weeks, while the amount of market share the world’s largest cryptocurrency has relative to other digital assets, also known as bitcoin dominance, has trended down in the last week to 46.9%. That has dampened this year’s trend, as bitcoin dominance had jumped to as high as 47.8% from a low of 41.0% in early January, according to TradingView.
ETH/BTC Ratio. Source: TradingView
In addition to BTC and BNB, the token for the Binance-produced blockchain, ETH outperformed benchmark indexes for the U.S. stock market like the S&P 500 and Nasdaq 100, according to The Defiant Terminal.
ETH, BTC, BNB, SPY, and QQQ on the week. Source: The Defiant Terminal
Outside of BTC and ETH, which account for roughly 63% of the total market capitalization of digital assets, DOGE has performed well on the week — the token which began as a meme has gained 24.4% in the past seven days, largely on the back of a move by Twitter to temporarily change the social media network’s logo to that of a Shiba Inu, the mascot for DOGE.
The only token which has performed better than DOGE in the past seven days among the top 100 digital assets is KAS, the native asset to a blockchain called Kaspa. KAS in the week’s top gainer despite a selloff of over 17% today.
The ARB token, which users of Arbitrum, the scaling solution for Ethereum received almost two weeks ago, has largely stabilized at a price of $1.24 as Wednesday after dipping as low as $1.13 and as high as $1.53 since its debut — trading volume for the token remains elevated at $587M in the past 24 hours, according to CoinGecko. That places ARB among the top ten digital assets in terms of volume in the past day.
Looking forward, the next FOMC meeting when the target interest rate will be decided is scheduled for May 3. The Chicago Mercantile Exchange’s often-cited FedWatch Tool, which predicts interest rate changes, is showing that 56.2% of traders anticipate no change to the interest on that day.
Interest rate probability. Source: FedWatch
Were rates to remain at current levels of between 4.75% and 5%, that would be the first time since January 2022, that the Federal Reserve did not raise rates.