While 2023 was initially believed to be a helpful year for cryptocurrencies, it seems now that the sector is set to finish the year on a more negative note again. Since January, Ethereum has been up approximately 50 percent, but from the middle of August, it began stagnating. The slowdown created apprehension among investors, and most switched to long-term holding, completely eliminating speculation from their strategies.
Now, users continue to remain apprehensive about the ways in which the marketplace will evolve in the future. And according to the opinion of the overwhelming majority, it seems that additional struggles are ahead.
In 2022, cryptocurrencies navigated what many analysts believe is the largest and most potent bear market that has ever occurred in the crypto environment. When 2023 ushered in the accumulation of new gains, many felt the slowdown was a thing of the past. But, the situation turned out to be more complex than initially anticipated.
Growth wasn’t linear, and the bulls struggled to hold the momentum and continue on their path toward gaining traction and helping the price build. Ethereum has remained somewhat constant, in the $1,600 area, but some research suggests that, unless there’s a change soon, the price could drop to support ranges as low as $1,100, or even below, as was the case in June.
In the worst-case scenarios, Ethereum is looking at a level of $800 or below, while some strategists are even more pessimistic, thinking that $400 is a possible level. However, despite these predictions, there are nevertheless positive things to be excited about when it comes to Ethereum. The future approval for the ETFs for Ether is expected in the upcoming months, and will likely have a positive influence on the price point.
The network also has planned upgrades that will bring significant changes to the platform. Scalability issues will be addressed, boosting use cases and reducing the fees associated with the transactional processes. More and more coins are removed from the supply because of the token burn mechanism, while staking continues to be a force to be reckoned with in the system. All these changes will support the value progression in the long term, so it’s likely that the bearish estimations will only be important in the near future.
Only a few years ago, non-fungible tokens were all the rage among investors. As some of the most valuable commodities in the world, some are traded for millions of dollars, making the news and becoming well-known even among those not directly involved in the marketplace. Yet, recent network activity paints a very different picture. Interest has been dwindling, and people no longer seem as interested in NFTs.
The rise of the Bitcoin Ordinals is partially to blame for this, as users flocked to the new asset class. Many were also ruled in by the relative stability of Bitcoin, even in a challenging environment, compared to the altcoins. Over the past twelve months, the metrics show that demand has become considerably reduced, being only a fraction of what it once was. On March 19th, there were 6,444 NFT trades recorded on the blockchain. Fast forward to September 14th, and the number was just 13. That means the trade count was down by a whopping 99.97 percent compared to its peak levels.
A relatively new social network has also overtaken the NFT demand, showing that the area is indeed experiencing bleak days. However, the middle of September also recorded a considerable surge in the number of daily addresses. The number peaked at $1.05 million on September 14th, almost double compared to only two days earlier, on the 12th. The numbers become even more interesting when you discover that on September 10th, there were fewer than 343,000 daily addresses daily.
The spike in network usage is likely a bullish sign, yet the on-chain volume shows that the last five days have remained within the predicted limits. Nonetheless, the price point might also record incoming changes if the market sentiment shifts toward the bulls.
Although Ethereum is still struggling under the yoke of a bear market, some investors and analysts have taken a more positive view toward the direction the price will take in the near future. Based on their estimates, the price is currently showing a few key positive signs, indicating that it will withstand the pressure and stay above $1,650.
At the moment, Ethereum is above the 23.6 percent Fib retracement level. Yet, there’s still resistance at $1,635 and $1,650. The latter tier, if overcome, could propel the Ethereum price closer to the $1,670 resistance level, from where it can expect a steady increase. If the momentum holds, the next resistance level will be considerably further away, at $1,750. Conquering this level means that Ethereum will advance to $1,880 and then move on to $2,000.
But it remains to be seen if the coin can rise up to this level and continue recording noteworthy gains. So far, ETH has managed to break above the $1,610 bearish trend line, so it might be the case that the coin will continue climbing over time.
The new Ethereum testnet, Holesky, is the direct result of the cumulated effort that the Ethereum developer community delivered over several years. With the introduction of this new network, Ethereum will part ways with its largest existing testnet, Goerli. At the moment, the system works alongside the other testnet on the blockchain, Sepolia. The two are fundamentally copies of the original Ethereum blockchain and are specifically designed to simulate transactions and test new apps.
A group of validators operates the current system, but there’s a risk that scaling issues could emerge on the mainnet. The testnet can catch these issues, but a larger, more comprehensive network naturally becomes necessary. Holesky gets its name from a train station situated in Prague, and some believe it is set to become more prominent than the Ethereum mainnet. This also means that a more considerable number of validators will soon have to operate the network.
The size of Holesky will enable developers to test new infrastructure and updates under more serious conditions, so any possible issue will be solved before making its way to the mainnet.
The Ethereum space has been going through a fair amount of trouble recently, and it seems there will still be more hurdles until it regains its full strength.