In recent weeks, ethereum’s tendency to have unhealthy transaction fees has ended. Transaction fees have collapsed. While some transactions cost $250, now they suddenly cost $25.
This drop is not caused by ethereum 2.0 or by rolling back ethereum’s ice age, it looks like a drop in NFT traffic into a post-frenzy collapse, along with a big drop in DeFi.
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Some will say that a lot more is happening on so-called Layer 2 blockchains like Polygon, which sit on or perhaps underneath – depending on your metaphor – ethereum and drain transactions, relieving stress on ethereum and thus reducing transaction costs.
For me, the increase in transaction costs has always been a forecaster of increases in ethereum prices, so when the opposite happens, it is an adverse omen. This is the ethereum chart: The ethereum chart looks worrisome (CREDIT: ADVFN). I would extend it like this, which is not going to make anyone happy: The price of ethereum could do this (CREDIT: ADVFN).
Many will say this could never happen, of course, but it certainly did happen in 2018. Report the bullish/bearish bitcoin chart if you want to read:The Case of the Bull and bear for Bitcoin (CREDIT: ADVFN).
Every time I make a bull/bearish chart of bitcoin (BTC), BTC has gone straight up in the uptrend projection. So right now I park my pessimism at the door, but the combination of collapsed transaction fees, the great competitive pressure of new smart contact platforms, the upcoming launch of V2 with all its potential for technical issues and NFT in a post-frenzy malaise; everything makes for a very complex situation to handle.
Interest in bitcoin and other cryptocurrencies such as ethereum, BNB, XRP, solana and cardano has increased in recent months as inflation fears engulf investors. In the US, prices rose 7.9% in the year to February, the highest inflation rate in 40 years.
However, Beard’s bitcoin price prediction requires bitcoin to exit its current niche.
“For the price [of bitcoin] to take off, it must graduate from its strong correlation with the Cathie Wood crowd and high-tech, high-priced stocks,” Beard said. Bitcoin’s price has moved along with tech stocks over the past two years as lockdowns and Covid stimulus measures pushed up prices.
Last month, Ark Invest’s Cathie Wood predicted that bitcoin’s price could surpass one million dollars by 2030, with ethereum’s market cap that could exceed $20 trillion.
“We believe bitcoin is the deepest application of public blockchains, the foundation of ‘self-sovereign’ digital money,” Ark Invest analyst Yassine Elmandjra wrote in the company’s 2022 outlook report, arguing technological advances such as the network’s Taproot update and the second-layer Lightning Network could help scale bitcoin.
*With information from Forbes US