The Ethereum price divergence with Bitcoin widened on Wednesday. While Ether rose to a new multi-month high of $3,560, Bitcoin remained about 5% below its highest level in August.
ETH rally accelerates
Ethereum is the second-biggest blockchain in the world. According to CoinMarketCap, the total value of all Ether in circulation is more than $412 billion.
In the past few years, Ethereum’s network has become the backbone of the blockchain industry as we know it. Besides, its technology has been used to build some of the most important platforms in the industry. For example, the biggest Decentralized Finance (DeFi) platforms in the world like Aave, Curve Finance, and Uniswap are all built using its technology.
Similarly, the biggest non-fungible tokens (NFT) platforms in the world like OpenSea are all built using its technology. Therefore, Ethereum price is jumping on Wednesday as activities in its network rise. For example, the total value locked (TVL) in the DeFi industry has jumped to more than $90.6 billion. This means that the ecosystem has recouped the value lost during the most recent meltdown.
Aave, the biggest DeFi platform in the world has seen its TVL jump to more than $16 billion. It is followed by Maker, whose TVL has jumped to more than $12 billion, according to DeFi Pulse. Other top performers are platforms like Convex Finance, Liquity, and Compound.
The ETH price is also rising as investors remain optimistic about the ongoing development of ETH 2.0. This is a major update that started in 2020 whose main goal is to transition Etherem from a proof-of-work network to a proof-of-stake consensus. The transition will also help Ethereum boost its speed, interoperability, and efficiency.
Recently, the developers successfully carried out the London hard fork that introduced the concept of burning. This was an essential process during the ETH 2.0 rollout. Still, the biggest challenge for Ethereum is that many Ethereum-killers like Avalanche, Elrond, and Solana are gaining market share.
Ethereum price prediction
The 4H chart shows that the ETH price managed to move above the key resistance level at $3,338, where it struggled moving above several times before. A closer look shows that this consolidation was part of a bullish flag pattern. The price also rose above the Ichimoku cloud and the 50-period moving average. Notably, this happened in a period of high volume. Therefore, Ethereum price will likely keep the momentum going on as bulls eye the next key resistance at $4,000.
