Dencun Surpasses by $4,000
The price of Ethereum experienced a significant surge on March 4, reaching a new peak for 2024 at over $3,740. This surge in price is attributed to the increasing popularity of ETH 2.0 staking, which indicates that the upcoming Dencun upgrade could lead to further gains.
In February 2024, Ethereum outperformed Bitcoin in terms of price, and this trend has continued into the first week of March, with Ethereum bulls doubling up on their staking positions. This suggests that investors are optimistic about the potential upside following the Dencun Upgrade, and it is likely that the price of ETH will attempt to reclaim $4,000 in the coming week.
The launch of the Dencun upgrade on the mainnet was confirmed for March 13, and one of its critical features, known as “proto-danksharding,” is expected to reduce transaction costs on Ethereum and auxiliary Layer-2 networks. This upgrade has generated anticipation among investors, and it is reflected in the on-chain data from the ETH 2.0 beacon chain. Despite reaching a new peak of $3,743 on March 5, investors have chosen to stake their coins rather than sell at these historic prices. The total staking deposits on the ETH Proof of Stake network have now surpassed 31.3 million ETH, with a total stake value of over $115 billion.
The increasing staking deposits not only enhance network security and stability but also indicate that ETH investors are taking a long-term approach, with high optimism surrounding the Dencun upgrade. The fact that Ethereum staking has reached $115 billion while prices are at a three-year peak demonstrates the overwhelming positive conviction among investors that the upcoming network improvements will drive the rally further.
Based on the analysis of the staking trends, it is forecasted that the price of Ethereum has the potential to reach $4,000 before the Dencun upgrade on March 13. However, for this to happen, ETH needs to establish steady support above $3,800 and withstand the profit-taking wave from a group of addresses that acquired ETH when prices last reached $4,000 in 2021. Breaking above this resistance level could pave the way for ETH to reach its all-time highs above $4,000.
On the downside, if the bears manage to reverse the price below $3,000, it could invalidate this prediction. However, recent market trends have shown that there is significant short-term support for ETH price at the $3,100 level.
In conclusion, with the increasing popularity of ETH 2.0 staking and the upcoming Dencun upgrade, Ethereum is poised for further price gains. Investors are confident in the network improvements and believe that the price rally will continue.
