Ethereum Surges to One-Year High Following Successful Shapella Upgrade
Ethereum's recent price surge has been the talk of the cryptocurrency market, with the asset crossing the $2,000 mark for the first time in nearly a year. The recent market activity has caused market dominance to increase, reaching just a few points near 20% after shaving dominance off Bitcoin.
The success of Ethereum can be attributed to a couple of significant developments. One of these is the successful implementation of the Shapella upgrade, which has driven momentum for ETH and resulted in an 11-month high.
The upgrade has been an essential catalyst for the altcoin season, which traders believe has begun. It appears that investor confidence has returned, and they are moving to other assets to diversify their portfolios.
A Surge in Ethereum Options Contracts Contributes to Bullish Wave
Another crucial factor that has helped Ethereum's recent surge is the increase in Ethereum options contracts. Currently, more than 260,000 ETH options are due to expire, compared to 30,500 Bitcoin options contracts.
According to derivatives traders, Ethereum options are more flexible than futures, which have fixed expiration dates. These contracts allow traders to speculate on the price of ETH and buy or sell at a specific price, the strike price, at a certain date of expiry. This flexibility is what has made them the preferred option for derivatives traders over Bitcoin options.
The increase in options has resulted in bullish market sentiment, with many investors looking for opportunities to make significant returns. However, experts advise that investors should exercise caution when investing in cryptocurrencies, as market volatility is a common occurrence.
ETH Withdrawals Fails to Make a Dent on Investor Sentiment
Despite the surge in Ethereum's price, the asset's recent staking withdrawals have not had any negative impact on the market. Industry analyst Colin Wu reported that nearly 240,000 ETH had been withdrawn after the upgrade. However, about 100,000 ETH has been deposited since the upgrade, indicating that the net staking balance is -139,900 ETH, valued at around $292 million using press time exchange rates.
Meanwhile, around 1.07 million ETH, or $2.25 billion, was pending withdrawal. Nansen reported that there have been times when deposits outnumbered withdrawals. Regardless, forecasts from Token Unlocks suggest a decline in the amount of ETH withdrawn going forward.
Ethereum Price Action
Following the launch of the Shapella upgrade on April 12, Ethereum was rocked by an aggressive billing wave, which pushed the price to the $2,100 mark for the first time since early May 2022 (around the time of the Terra collapse). This rally came despite widespread expectations of a sharp decline. Many analysts based their projections on the price event that followed the Ethereum Merge upgrade in September 2022.
That said, ETH is currently sitting on a 27% rally in April but now faces the challenge of holding on to these gains. Another slip this week could mean the price returns to the $2,000 mark, where more buyers could come on board.
The primary target for Ethereum bulls now is $2,500, which could signal the end of the prolonged bear cycle. However, this target is currently a long way away and would require ETH to gain at least 17% to attain.
The question now is: Can Ethereum bulls pull off another 17% in the coming days and weeks?
ETH Statistics Data
ETH Current Price: $2,130
ETH Market Cap: $255B
ETH Circulating Supply: 119.7M
ETH Total Supply: 119.7M
ETH Market Ranking: #2
Feeling confident? Trade your idea on ETH now
Disclaimer
This article should not be taken as financial advice. It is essential to conduct research before making any investment decisions.