Ethereum (ETH) has broken through the $4,000 price level for the first time since March 2024, marking a significant recovery after months of subdued performance.
Key Market Trends
- Weekly Growth: Ethereum’s price surged by 10.7% over the past week, according to CoinMarketCap data.
- Technical Indicators: The 200-day Exponential Moving Average (EMA) now acts as dynamic support, while the Relative Strength Index (RSI) at 71 signals overbought conditions.
- Political Influence: The current rally began on November 6, coinciding with Donald Trump’s U.S. presidential election victory.
👉 Explore real-time ETH price trends
Analyst Predictions
Some analysts project Ethereum could reach $7,000 in this market cycle, driven by:
- Record-breaking inflows into Ethereum ETFs.
- A robust ecosystem of decentralized applications (dApps).
Layer-1 Revenue Recovery
The Dencun upgrade (March 2024) drastically reduced fees for Ethereum’s Layer-2 networks, causing a 99% drop in Layer-1 revenue. However, network fees have rebounded since September:
| Period | Fee Revenue |
|--------------|-------------------|
| August 2024 | ~$500,000 |
| December 2024| ~$10.9 million |
Data sourced from Token Terminal.
Proposed Solutions
Justin Drake, a longtime Ethereum Foundation researcher, advocated for native sequencers operated by validators to enhance interoperability between dApps and rollups.
FAQs
Q: Why did Ethereum’s price rise suddenly?
A: The rally aligns with political developments and renewed institutional interest via ETFs.
Q: Is Ethereum overbought?
A: With an RSI of 71, short-term correction risks exist, but long-term fundamentals remain strong.
Q: How did the Dencun upgrade affect fees?
A: It slashed Layer-2 transaction costs but initially eroded Layer-1 revenue.