It has been one week since Bitcoin price notched a new high after days of flirting with $60,000. Positive news around Bitcoin ETF approvals provided enough boost to lead the flagship towards its current ATH. Ether tagged along, leading the altcoin rally once again and printing a new peak above $4,360. The token has since retraced after failing to cement its place as Bitcoin did.
Bitcoin’s Influence on Ethereum
Ethereum’s recent charge to a new all-time high has largely been on the back of Bitcoin’s rise. The token has followed Bitcoin’s lead several times this month, but unlike the leading crypto, which [in the latest surge] swung around its ATH for a while, Ether only grazed past its previous 5-month high before facing harsh rejection at the level a few minutes later.
Analysts argue that Ether’s short-lived rise followed by a slide highlights the lack of its own upward momentum. They contend that the token plunged after seeing immediate resistance because it relied on Bitcoin’s upswing. Despite the rejection at $4,300, Ether has managed to remain above $4,000 for the most part.
Not all on Bitcoin, though, Ethereum has some positives
Ethereum traders seemingly placed reliance on Bitcoin, but, on its part, the Ethereum blockchain has also been seeing some progress, particularly in the DeFi and NFT cases.
Both applications have posted significant growth over the last few months. Earlier this month, a DappRadar report showed that NFTs had hit a record $10.67 billion in sales volume. Over the last 30-days, the NFT sales volume stands at over $2.74 billion, with the Ethereum blockchain responsible for $1.89 billion.
The Ethereum blockchain has, in recent days, seen competition from newcomers like Solana and Binance Smart Chain in decentralized finance. Nonetheless, it has remained dominant in market share. It currently accounts for more than two-thirds (67%) of the total value locked in DeFi protocols.
Altcoins also chased Ether’s tail
Ethereum’s upsurge to a new high last week was not without a ripple effect – at least on some of the altcoins. Binance Coin, Solana, Cardano, and Ripple all posted gains as Ether’s gains reverberated to the broader altcoin market. Except for Solana, the other tokens have corrected and are down over the last 7-days. Solana, which is changing hands at $188, has dipped 9.54% in the past 24 hours but is almost 20% over the last 7-days, according to data from coinmarketcap.
The Altair Upgrade
The Altair update, whose launch was initially slated for the end of September, has gone into effect today, October 27. The Ethereum development team had revealed the upgrade plan earlier, further detailing that the Proof-of-Stake switch was underway and the complete changeover would end next year in February.
The Altair upgrade follows the Beacon Chain launch that took place in December and is equally significant in defining the future of the network despite not carrying any drastic improvements. It is the first and could be the only upgrade to the Beacon Chain on the mainnet before the switch to proof of stake, according to Ethereum Cat Herders’ Pooja Ranjan.
In addition to enhanced client support for Beacon Chain, the upgrade is expected to feature a new reward-penalty scheme for validators. The upgrade has been billed to have solutions for some bugs and is the first phase in moving to the Proof of Stake consensus mechanism.
The Beacon Chain, which runs on the mainnet parallel to the proof-of-work chain, brought staking to the Ethereum table. It, however, didn’t have a provision for withdrawing funds, but that will be sorted “with a later upgrade in 2022,” according to Ranjan. While Altair won’t likely affect the market, it is critical, especially for validator nodes runners.
Ethereum (ETH) Market Performance
Ether has traded above the $4,100 level over the last three days. The token gathered some momentum and embarked on a climb towards $4,300 on Monday but got rejected just below the target price on Tuesday. The consequent dip saw ETH/USD tumble below $4,130 before clawing its way up. The upswing was once again short-lived as the pair plunged sharply today to set a 24 hour low of $3,960.
The token is currently trading at $4,010 – down almost 5% in the last 24 hours. The bull’s primary focus at present is to keep the token above $4,050 and prevent another fall below the mark. The next target will be to find stable grounds above the resistance at $4,150. That said, there is a high possibility that the token could decline even further on the short-term, with the next two support levels coming at $3,950 and $3,800 if it gets rejected above $4,100.
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