Ethereum 2.0 Deposit Contract Crosses 3 Million ETH

Ethereum 2.0 Deposit Contract Crosses 3 Million ETH

Ethereum 2.0, the network upgrade of ETH, has crossed 3 million ETH under its deposit contract as the Ethereum community extended their support for ETH 2.0. The total value of ETH locked under the network upgrade jumped above $5.4 billion after the recent jump in the price of the world’s second-largest cryptocurrency.

Ethereum 2.0 started its journey in December 2020 with the launch of Beacon Chain. ETH 2.0 deposit contract crossed 1 million ETH within the first week of its launch. The Ethereum network has started its journey to shift from the current proof-of-work network to a more efficient and improved proof-of-stake network.

The ETH price is up nearly 150% since the start of 2021. The world’s second-largest digital asset registered an all-time high of $1,870 on 13 February as the total market cap of Ethereum jumped above $210 billion. As of writing, the cryptocurrency is trading near $1,750 with a total market cap of $200 billion.

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The CME Group launched Ethereum Futures Contracts last week and the Group reported trading of 388 ETH contracts with a total trading volume of $33.6 million on its first day. Additionally, ETH’s on-chain network activity has increased significantly in the last few months as now the network is settling more value than BTC.

Ethereum Inflows

Finance Magnates earlier reported a significant jump in Ethereum-related weekly crypto inflows. ETH accounted for nearly 80% of the total $245 million crypto inflows during the first week of February 2021. Institutional demand for the world’s second-largest crypto-asset jumped substantially since the launch of Ethereum 2.0. Now, Grayscale has 3.13 million ETH under management with a total value of $5.67 billion. The CEO of Grayscale Michael Sonneshein reported growing interest in Ethereum-related investment products.

Ethereum 2.0 received strong support from the crypto community as staking participants are hopeful for an improved version of the network in the form of ETH 2.0. The current transaction fee of ETH is a big issue for the users, the network upgrade aims to address the issue of large transaction fees and the number of transactions per second.

Ethereum Price Prediction: Upward Momentum to $2,000 Intact

Ethereum price nosedived by more than 10% in the overnight session after a broad sell-off in cryptocurrency prices. The ETH price has dropped by more than 4% while Bitcoin, Cardano, Ripple, Litecoin, and Polkadot have fallen by more than 5% in the past 24 hours. This brings its total market cap to more than $200 billion.

Ethereum News: ETH suffered a harsh reversal after the price soared to an all-time high of $1,874 on Saturday. Similarly, Bitcoin rose to its all-time high of $49,700 after BNY Mellon, one of the biggest banks in the US started offering crypto custodial services.

Therefore, since there was no major news, the current weakness is mostly because of profit-taking. Furthermore, ETH price has already risen by more than 1,000% from its lowest level in 2020. So, what next for the Ethereum price?

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ETH price technical outlook

In an article earlier today, an analyst said that the Ethereum price was on track to decline by more than 35% to $1,040. He focused on the four-hour chart, which has developed a rising wedge pattern. However, this thesis seems to be premature since the chart he used showed that the wedge was not close to its tipping point.

Now, turning to the daily chart, we see that the ETH price fell to an intraday low of $1,661. This level was not by accident. In fact, it was along the ascending pink trendline that connects the lowest levels since January. In fact, the price has formed an ascending channel. Therefore, in the near term, there is a possibility that it will bounce back to $1,950, which is along the upper side of the channel. This is in line with my earlier prediction that ETH will soon rise to $2,000.

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Bitcoin and Ethereum Fundamentals Look Strong While Technicals Spell Trouble

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Key Takeaways The number of Bitcoin whales has risen by approximately 200% over the past three weeks.

Meanwhile, Ethereum’s network has grown by 67% since the end of December 2020.

Even though these metrics are bullish, technical patterns warn of a potential correction.

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Bitcoin and Ethereum show ambiguity from a technical perspective, despite rising interest behind these cryptocurrencies.

Bitcoin Whales Go Into Buying Frenzy

Overleveraged traders are getting crushed as Bitcoin becomes more volatile over time. After reaching a new all-time high of $49,700 on Feb. 14, BTC took an 8% nosedive a few hours later.

The sudden downswing to $45,350 generated more than $1.90 billion in liquidations across the board.

Despite the massive losses incurred within such a short period, sidelined investors took advantage of the downward price action to get back into the market. The spike in bullish momentum allowed Bitcoin to quickly regain the $48,000 level as support.

When considering the rate at which whales have been adding more tokens to their portfolios, the optimistic narrative holds.

Santiment’s holder distribution chart shows that the buying pressure behind Bitcoin has risen dramatically over the past three weeks. The behavioral analytics firm recorded a significant spike in the number of addresses holding 100,000 to 1,000,000 BTC.

Roughly two new whales with $4.80 billion to $48 billion worth of Bitcoin have joined the network, representing a 200% increase.

While buy orders continue to pile up behind Bitcoin, the technicals spell trouble. For instance, the Tom Demark (TD) Sequential indicator presented a sell signal on BTC’s daily chart. The bearish formation developed as a green nine candlestick, anticipating a one to four 1-day candlesticks correction.

The Relative Strength Index (RSI) also suggests that Bitcoin is primed to retrace because it sits overbought territory. This momentum indicator created a bearish divergence as it made a series of lower highs, while BTC’s price created a series of higher highs.

Given the ambiguity that Bitcoin presents, the recent high of $49,700 and the 78.6% Fibonacci retracement level are the most critical resistance and support points to watch.

A daily candlestick close above or below this trading range will determine where BTC is headed next. While bulls target $63,000 upon the break of the overhead resistance barrier, the bears will likely aim for $40,000 if the $45,000 support level fails to hold.

Ethereum Sits on Top of a Demand Barrier

Ethereum has enjoyed a slow but steady uptrend since mid-January that saw it reach a new all-time high of $1,875. The price action appears to have created a rising wedge within ETH’s 4-hour chart.

One trend line can be drawn around the swing highs while another seems to join the swing lows.

This technical pattern usually signals a price reversal. Therefore, an increase in the selling pressure that pushes Ethereum below the wedge’s lower boundary could be catastrophic since it may lead to a 32.5% correction. ETH might take a nosedive towards $1,200 before the uptrend resumes.

Nonetheless, IntoTheBlock’s In/Out of the Money Around Price (IOMAP) model reveals Ethereum sits on top of a massive demand barrier that will not be easy to break. Over 170,000 addresses bought more than 8.50 million ETH between $1,775 and $1,815.

Further price deprecation may prove challenging since holders within this price range will do anything to keep their positions “In the Money.” They may even buy more tokens in the event of a downswing to allow Ether to rebound.

Moreover, the Ethereum network continues expanding, which favors bull investors. After bottoming out in late December 2020 at a low of 85,050 addresses per day, the network’s growth has skyrocketed. More than 142,000 new addresses are being created per day at press time, representing a 67% increase.

This network expansion can be considered a very optimistic signal because it is often regarded as one of the most accurate predictors of price. As such, the ongoing uptrend in user adoption may help ETH avoid a steep correction and instead march towards higher highs.

Due to the lack of resistance ahead, it is reasonable to assume that a 4-hour candlestick close above the recent high of $1,875 will drive the price of ETH towards $2,600. Under such circumstances, the rising wedge will be regarded as a continuation pattern.

But if the bulls fail to contain prices from slicing through the $1,800 support, a steep correction to $1,200 will be inevitable.

The Cryptocurrency Market Moves Forward

Despite the ambiguous outlook that Bitcoin and Ethereum show, some of the most prominent figures in the cryptocurrency industry believe that the bull market has just begun.

In a recent blog post, on-chain analyst Willy Woo stated that institutional investors have mainly driven the ongoing rally behind Bitcoin. Now, it seems like retail investors are trying to get a piece of the cryptocurrency before prices rise higher.

By identifying the number of unique addresses, Woo determined that 20,000 new addresses joined the Bitcoin network each day during the past five weeks. He stated that this is a “sure sign that retail investors are now coming in,” adding that those investors “typically start ramping up in numbers during the middle phases of bull markets.”

If the trend continues, Bitcoin may be able to invalidate the TD setup’s bearish outlook and aim for $63,000, bringing Ethereum up with it.

Disclosure: At the time of writing, this author owned Bitcoin and Ethereum.

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