ETH is the second-largest crypto asset in the world and is one of the most prominent altcoins out there. After facing quite the struggle, the price of the digital currency has surged and crossed the crucial $4,000 price region.
It is currently trading at $4,374 (at the time of writing) and is expected to go higher. The Ethereum network is quite promising and has a lot of potential. Its upgrades such as the much-awaited London Upgrade are one of several reasons why the significance of ETH keeps on growing.
Here is a graph by CoinMarketCap that shows ETH’s price surge in the last 24 hours.
The Ethereum network is also reportedly facing the first consecutive week of deflationary issuance amid positive market conditions. Let’s find out more about the Ethereum network and if it will affect the price of ETH.
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What is Going on in the Ethereum Network?
Many people who take part in the BTC vs ETH debate, are of the opinion that Ethereum will outperform Bitcoin because this network keeps evolving and improving technologically. One of the recent upgrades for the Ethereum network was the London Hard Fork Upgrade, which consists of five improvement proposals.
In early August, the London Upgrade introduced a burning mechanism into Ethereum’s fee market. Now a small number of Ether tokens is burned every time a transaction is processed on the network.
The first consecutive week of deflationary issuance seen by the Ethereum network means that the number of ETH removed from the supply is higher than the ETH mined. At the moment, the gas prices for Ethereum’s network are low and in order for it to produce consistent deflationary blocks, the gas prices need to remain above 150 gwei.
According to reports, over 724,400 ETH has been burned since the London Upgrade, which is worth around $3.1 billion.
The deflationary issuance seen for the Ethereum network was anticipated to occur in the first half of 2022, according to Anthony Sassano, the co-founder of EthHub. This is when the merge between Ethereum blockchain and Eth2’s Beacon Chain is set to take place.
Sassano also stated that the EIP-1559 upgrade has not increased the gas prices as expected, instead, it facilitates an overall smoother network functioning. Therefore, it can be expected that the deflationary issuance will work in favor of ETH’s price.
What Should Crypto Investors and Traders Know?
Despite slight price corrections seen for digital assets such as Bitcoin and Ethereum, the crypto market seems to be moving in an upward direction. The two largest cryptocurrencies are currently moving in the green and are expected to move higher if the expected support levels are maintained.
Ethereum is currently trading above the $4,200 price region, whereas the flagship digital currency is trading above the $60k price mark (at the time of writing).
However, if you are new to the crypto space and want to buy ETH then make sure you take a look at an Ethereum buying guide beforehand.
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