Ethereum (ETH), the world’s second-largest cryptocurrency, has experienced a sharp price rise, gaining more than 10% to reach a high of $2,130.30, its highest level since May 2022.
However, the upward rally can be attributed to the successful implementation of the Shanghai and Capella upgrades.
ETHEREUM PRICE PREDICTION
PRICE : RISE⤴ in 60 min.
BUY 2.39 ETH for $2,088.55 apiece on Binance
Target price : $2,130.32
Amount: $4,992#Ethereum #ETH #Binancehttps://t.co/aflTGzVc9E pic.twitter.com/Oxwdczzi61
— Cryptocurrency Price Predictions (@cryptojohnsmith) April 16, 2023
It is worth noting that the Shanghai upgrade, also known as “Shapella,” has enabled Ethereum staking withdrawals after a two-year lockup period.
Consequently, this development is viewed as a significant factor for Ethereum investors, as it offers increased liquidity for those who have staked their ETH. This is likely to boost institutional participation in the platform.
Ether rises 5% and consolidates above $2,000 pic.twitter.com/dJH2cmumGp
— Cryptojim (@jimmacs16) April 14, 2023
Thus, this led to renewed confidence in Ethereum and contributed to the upticks in Ethereum. Furthermore, Ethereum and other cryptocurrencies have been performing well since the Shapella upgrade.
In fact, Ether’s dominance has been increasing as compared to Bitcoin and other altcoins. This was seen as a positive development for Ethereum, as it indicates that more people are interested in investing in Ether, which will ultimately lead to a potential price rally in the future.
Although, the upticks in the ETH prices can vanish as the FedWatch tool predicts that the Federal Reserve will raise interest rates in their May 3 meeting. This news will likely have an impact on the overall crypto market, including ETH prices.
The CME #FedWatch Tool predicts that the #Fed will deliver a final 25bp hike at the May meeting, and reduce rates by 75 bp by the end of 2023, followed by another 125 bp cut by the end of 2024.
More Info: https://t.co/UyfeVJlIsW pic.twitter.com/11WZHtkKmm
— MacroMicro (@MacroMicroMe) April 12, 2023
The ETH/USD pair is currently trading at $2,095, with a 24-hour trading volume of $9.2 billion. Ethereum has fallen less than 0.10% in the last 24 hours. Ethereum is the market’s second-largest cryptocurrency, with a live market value of $250 billion. There are 119,434,715 ETH tokens in circulation, with no maximum supply.
Ethereum’s Shanghai Upgrade Proves Successful
As we previously stated, the price of Ethereum surged more than 10% and broke the $2,000 mark for the first time in eight months right after the Shanghai upgrade was introduced.
It is worth noting that the upgrade aims to improve the blockchain’s efficiency and scalability while reducing its energy consumption.
Shanghai Upgrade on ETH was a success! ⟠#ETH #ethereum #shanghai pic.twitter.com/C6WyLU784h
— Royal Rabbits (@RabbitCLTV) April 13, 2023
This is why, investors are optimistic about the upgrade’s potential benefits for the long-term growth of the Ethereum network, particularly in terms of providing more liquidity to investors and stackers.
Thus, this news has caused investors to feel optimistic about the future of Ethereum.
It is worth recalling that Shapella upgrades for Ethereum happened on April 12, and it looks like most validators are withdrawing only their rewards instead of selling Ether. This is good news for the future of Ethereum, and the increase in Ether staking deposits could potentially lead to a price increase.
Impact of Federal Reserve Comments on USD and Cryptocurrencies
On the other hand, the broad-based US dollar gained significant traction and rose to a one-month high as traders anticipated another interest rate hike by the Federal Reserve. This news caused most cryptocurrencies, including BTC, to experience a drop in value.
Gold steadies above $2,000 as markets reassess Fed risks – https://t.co/9Ivegc9sFg #Commodities #GOLD pic.twitter.com/xigPhW02XT
— Investing.com UK (@uk_investing) April 17, 2023
It should be noted that Federal Reserve officials had recently made comments about increasing interest rates, which prompted investors to sell their assets to make profits from the previous gains.
However, these remarks overshadowed the earlier speculation that the Fed would soon pause its rate hikes. Notably, the previous speculation was based on lower inflation and slower job growth.
Anyhow, the latest comments from the Fed officials have caused the value of the US dollar to increase and most cryptocurrencies, including BTC, to decrease in value.
Crypto Inflows Rise Amid US Recession Fears
The global cryptocurrency market has been mainly supported by its increasing safe-haven demand, as well as concerns about the collapse of several US banks. Although fears of a larger financial crisis have subsided, expectations of a US recession this year have driven more people to invest in BTC.
Spending at US retailers fell in March as consumers pulled back after the banking crisis fueled recession fears https://t.co/LVBgDrLB9R pic.twitter.com/tuouSvJSeZ
— Rocco Del Greco (@RoccoDelGreco) April 17, 2023
BTC is seen as a safe-haven asset, similar to gold, during times of economic uncertainty. Investors turn to BTC as a way to diversify their portfolios and protect their wealth from potential market downturns.
Normally, Ethereum (ETH) follows Bitcoin (BTC) in terms of price movements, as the cryptocurrency market is highly interconnected. Thus, this means that when BTC experiences a significant increase or decrease in value, it can also have an impact on the value of other cryptocurrencies like ETH.
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