Ethereum surges past $4,000 for the second time in its history

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The Ethereum (ETH) price neared the $4,000 mark for the first time since December 2021 on March 8, 2024. As of March 11, it has gone past $4,000, the second time in the entire price history of Ethereum. The upward movement in Ether's price seems to be fueled by anticipation surrounding Ethereum's upcoming Dencun upgrade and the potential approval of a spot Ether exchange-traded fund (ETF) by the United States Securities and Exchange Commission (SEC).

As of writing, ETH is holding down at $4,010 and continues to be on the rise, while other major cryptocurrencies are also displaying positive sentiment, with Bitcoin at $71,085.

The Dencun upgrade, considered the most substantial enhancement to the Ethereum network since the merger, aims to incorporate several Ethereum Improvement Proposals (EIPs), including EIP-4844, which introduces "proto-danksharding."

Proto-danksharding is a feature designed to enhance transaction processing by utilising blobs, thereby expediting transactions and reducing costs for layer-2 chains and rollups dependent on Ethereum. The Ethereum developers have scheduled the Dencun mainnet launch for March 13.

Additionally, there is optimism about the SEC's potential approval of spot Ether ETF applications. It's expected that the SEC will announce its decision on all spot Ether ETF applications simultaneously, similar to its approach with Bitcoin ETFs on January 10, to maintain fairness among issuers. The statutory deadline for the SEC's decision on ETFs is set for May 23.

It is believed that the SEC's decision-making process for Ether ETFs won't be as prolonged as it was for Bitcoin ETFs. Drawing from the success of spot Bitcoin ETFs since their launch on January 11, a spot Ether ETF product is anticipated to attract significant capital inflow into the second-largest cryptocurrency by market capitalisation.

It is possible that institutional investors may increase their exposure to Ether once attention shifts from Bitcoin's recent all-time high to the potential of an ETH ETF. This could lead to liquidity consolidating at higher levels, potentially triggering price rallies in the long term. With the potential for increased institutional interest and capital inflow, Ethereum's position as the second-largest cryptocurrency is poised for further growth.

Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist.
Twitter: @bhardwajshash