In the frantic race for innovation, Ethereum continues to add new strings to its bow to attract cryptocurrency enthusiasts. The latest discovery? A hard fork called Dencun, the fruit of the hard work of the team led by the visionary Vitalik Buterin. Strangely, this major update did not have the desired effect on the price of ETH, leaving observers perplexed.
Success of Dencun: ETH struggles to trade above $4,000
Dencun, a fusion of Cancun and Deneb, is the object of all attention. This long awaited hard fork promises to bring its share of improvements to the Ethereum ecosystem: transaction processing capacity reaching up to 100,000 transactions per second, significant drop in gas costsetc.
Despite the success of the update, the price of ETH has not been affected positively, continuing to consolidate below the $4,000 threshold. The crypto attempted to break above this crucial resistance level on Monday and Tuesday, but failed to maintain its position above it, states Bitcoin.com.
For over 24 hours, ETH has been trading between $3,930 and $3,970. Nonetheless, it is worth noting that ETH has maintained its bullish momentum, with gains greater than 18% in the last fourteen days and almost 60% in the last thirty days.
In addition, the introduction of Dencun upgrade is expected lead to an increase in demand for ETH, potentially triggering a new bull run that could close the gap between current trading prices and its previous all-time high (ATH) of $4,878, reached in November 2021.
ETH: A recovery as hoped for
On March 11, Ethereum crossed the $4,000 mark, following in the wake of Bitcoin. Reaching a new high above $4,050, it then suffered a slight downward correction yesterday.
After bottoming at $3,830, the price recovered, crossing the resistance of $4,000. It even surpassed the 50% retracement level of the recent decline.
However, resistance remains at $4,085. If this barrier is not breached, a downward correction is likely, with initial support at $4,020. Further down, the 100 hourly SMA offers major support at around $3,965. In the event of a breakout, Ethereum could fall towards $3,880 or even $3,830.
At the time of writing, it was trading at $3,970.38 per coin.
Dencun: Another step forward?
The long-awaited Dencun update has been successfully deployed to Ethereum mainnet. See the tweet below, Tim Beiko, lead developer of the Ethereum Foundation, welcomes the work accomplished, but emphasizes the challenges encountered.
This upgrade aims to optimize Layer 2 networks such as Arbitrum, Optimism, and Coinbase, and resolve congestion issues by freeing up space for more transactions. However, it involves loss of complete data in the long term.
Despite this, layers 2 adopting the update provide significantly reduced gas costs thus providing increased accessibility to the Ethereum community.
Maximize your Tremplin.io experience with our ‘Read to Earn’ program! For every article you read, earn points and access exclusive rewards. Sign up now and start earning benefits.
