Ether (ETH), the native cryptocurrency of the Ethereum blockchain, has surged past $4,000, marking a significant recovery after months of subdued performance.
According to CoinMarketCap, Ether is up 2.8% on the day and has gained 10.7% over the past week, reaching its highest level since March 2024. The rally follows a prolonged period of trading below its 200-day exponential moving average (EMA), a key dynamic support level. With a relative strength index (RSI) of approximately 71, Ether has entered overbought territory, signaling potential further momentum.
Ether began its current rally on Nov. 6, 2024, spurred by market optimism following Donald Trump’s victory in the U.S. presidential election. The price crossed the $4,000 mark on Dec. 5, as bullish sentiment gained traction.
The price movement reflects activity across global cryptocurrency markets, with Ethereum’s performance closely tied to its robust ecosystem of decentralized applications and developers.
Several factors have contributed to Ether’s resurgence. Analysts point to increased inflows from Ethereum-based exchange-traded funds (ETFs) and renewed interest in the network’s ecosystem. The March 2024 “Dencun” upgrade, which significantly reduced fees for layer-2 scaling solutions, initially suppressed Ethereum layer-1 revenues but created a more efficient network. After hitting a low in August, network fees rebounded in September, with the Ethereum base layer generating $10.9 million in fees on Dec. 5, compared to $500,000 during the fee suppression period.
The rally reflects Ethereum’s growing strength as a smart contract platform, with analysts projecting prices could reach $7,000 in this market cycle. To address concerns about competition from layer-2 networks, Ethereum Foundation researcher Justin Drake has proposed introducing a native layer-1 sequencer. This sequencer, run by Ethereum validators, would improve transaction ordering and composability between decentralized applications and rollups, potentially boosting the network’s long-term viability.
Ether’s breakout past $4,000 signals renewed investor confidence in Ethereum’s ecosystem and highlights the network’s adaptability in an evolving blockchain landscape.
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