Ethereum prices have dropped by almost 10 per cent from last week’s price highs. However, in today’s trading session, the cryptocurrency is showing signs of a bullish move, increasing by 1.5 per cent.
Why Ethereum is at a Critical point
Sometimes later this year, Ethereum is expected to launch its new ‘Merge” technology. This will be the biggest change that the Ethereum platform has ever implemented. Many experts also call this migration to the Merge technology a critical point that could make or break the crypto.
The new Merge technology will append how new Ethereum tokens are created. Today, Ethereum is not owned by anybody. It runs on a network of data centres throughout the world. These data centres operate as miners on the network, allowing transactions posted to be executed. In return, the data centres operators are awarded Ethereum token, Ether. This system is referred to as proof of work.
However, the Merge technology is looking to replace how the proof of work system works. The new system will replace miners with stakers. It will also replace the requirement that data centres have to solve complex calculations to be awarded Ethereum tokens. The system will also be low on energy usage, bringing an end to criticism Ethereum has faced over the years over its environmental unfriendly electric requirements.
Ethereum Price Prediction
The daily chart below shows Ethereum prices trading at about 1.5 per cent above today’s opening price. The chart also shows that Ethereum has been on a long-term upward trend. However, the past few days have seen the cryptocurrency drop by about 9.5 per cent.
Using a Fibonacci Retracement tool, we can see that the price drop was likely a retracement. This is based on the daily chart where the prices retraced to a 38 per cent Fibonacci retracement level before picking up the bullish trend again. Therefore, my Ethereum price prediction expects the prices to go up. There is also a high likelihood that the prices will be trading above $3,500.