- 1 On Wednesday, Ethereum tokens were trading with a surge of 6%, which is remarkable in 2023.
- 2 The observed momentum is the result of expectations of a positive trend in 2024.
- 3 The upcoming upgrade and ETF approval can cause a significant upward movement in the markets in 2024.
Ether has seen a huge rise in prices of 6% in a single day on Wednesday, December 27th, 2023. The significant factor that is driving the prices of Ether up is that the community users are expecting a massive upside movement in January 2024.
As per the data presented on Coin Metrics, Ether is trading higher by 6%. Solana’s SOL token was up by 2% this year.
Reasons for the Price Hike of Ether
Ethereum’s upcoming Dencun
The upcoming Ethereum upgrade “Dencun” is expected to begin testing on the Goerli Testnet on January 17, 2024. The upgrade is also called Cancun-Deneb. Ethereum has published this official note on their Ethereum Github repository.
After that, the upgrade will be tested and implemented on the Sepolia testnet on January 30, 2024, and Holesky on February 7, 2024. The Ethereum team hasn’t yet announced the final date of its implementation on the Ethereum mainnet.
Rotation back into the Ethereum Ecosystem
Needham analyst John Todaro stated that the growth of Ether is attributed to a rotation back into the Ethereum ecosystem from other Layer 1 blockchains. These other blockchains have outperformed Ethereum.
Solana and Avax are the most known examples of this outperformance, among others. Now, ETH is also performing to catch up on the rotation.
Throughout 2023, ETH was far behind the Solana. In December, ETH is 15% up while the SOL token has shown a gain of 82%. In 2023 as a whole, Ether has grown by 95%, while SOL has increased by more than 980%.
Spot ETF Approval
Investors are closely monitoring the developments in the SEC’s ETF approval. The decision on the spot Bitcoin ETF is mostly expected in January 2024.
Investors are highly optimistic that once the BTC ETF gets approved, the ETH ETF will also be launched soon.
As of now, the Ethereum spot ETF approval is less certain. The timeline for the same has not been very clearly announced. It will only be confirmed after the approval of the BTC spot ETF. Investors will first see the performance of the BTC ETF and then see the growth of the ETH ETF.
Looking at the current sentiments of investors and market sentiments in 2024 can mark the approval and launch of the spot Ethereum ETF.
Ether’s sudden rise on Wednesday recommends the rotation of the market into an ETH-centric trade. Matt Maximo, a senior research analyst from Grayscale Investments, has stated that the growth of ETH will highly depend on the SEC’s approval of the U.S. spot Bitcoin ETF.
However, Ethereum’s on-chain activities are extremely strong, which will support the growth of ETH in 2024. With all this, the growth of ETH in 2024 is highly expected, as it is less certain. However, the level of growth is highly uncertain and will depend on the factors discussed in this article.
The views and opinions stated by the author, or any people named in this article, are for informational purposes only. They do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.
Steefan George is a crypto and blockchain enthusiast, with a remarkable grasp on market and technology. Having a graduate degree in computer science and an MBA in BFSI, he is an excellent technology writer at The Coin Republic. He is passionate about getting a billion of the human population onto Web3. His principle is to write like “explaining to a 6-year old”, so that a layman can learn the potential of, and get benefitted from this revolutionary technology.