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Ethereum Price Breaks Past $4,000 — Will It Reach All-Time High?

Last Updated March 11, 2024 12:13 PM
Teuta Franjkovic
Last Updated March 11, 2024 12:13 PM
By Teuta Franjkovic
Verified by Peter Henn

Key Takeaways

  • Ethereum hit $4,000 fueled by excitement for the Dencun upgrade and potential approval of a spot ETH ETF.
  • Dencun aims to improve scalability and efficiency with “proto-danksharding” and potentially lower Layer 2 fees.
  • Expedited approval for ETH ETFs could attract institutional investors, boosting long-term price and adoption.

On March 8, 2024, the price of Ethereum (ETH) approached the $4,000 milestone for the first time since December 2021.

By March 11, it surpassed  the $4,000 mark, only the second time the coin reached that level.

Ether Soars on Dencun Upgrade Hype and Potential SEC ETF Approval

Two things appear to be driving the recent surge in Ethereum’s value. Firstly, there is excitement surrounding the forthcoming Dencun upgrade. Secondly, the prospect of the United States Securities and Exchange Commission (SEC) approving a spot Ethereum exchange-traded fund (ETF) has also boosted interest.

Currently, ETH is trading  at $4,024. It is not the only major crypto going on an uptrend. For instance, at the time of writing (March 11 2024), Bitcoin is worth $71,085.

The Dencun upgrade, arguably most significant update to the Ethereum network since The Merge, should implement various Ethereum Improvement Proposals (EIPs). Among these, EIP-4844 stands out, introducing “proto-danksharding,” a key development aimed at enhancing the network’s efficiency.

Dencun Upgrade: A Leap Towards Scalability and Efficiency

Ethereum’s Dencun upgrade, set for launch on March 13, 2024, represents a shift towards improving the blockchain’s scalability and transaction cost efficiency, particularly for Layer 2 networks. This upgrade includes the implementation of proto-danksharding, introducing a novel approach to data handling through “blobs” or Binary Large Objects. These blobs will temporarily store transaction data on the consensus layer. Therefore, they aim to significantly reduce congestion and lower transaction fees by up to 90% for Ethereum Layer 2 platforms like Arbitrum and Optimism​​​​.

Proto-danksharding could be as a key step towards full danksharding. This is a future upgrade that should expand Ethereum’s scalability. It will do this by breaking down the network into multiple shards, capable of processing transactions and smart contracts independently. This approach not only aims to alleviate network congestion but also reduces transaction fees. As a result,  Ethereum could be more accessible and appealing to users and developers alike. Moreover, Ethereum says, the Dencun upgrade, incorporating both the Cancun and Deneb upgrades, will enhance transaction throughput from around 15 transactions per second to an estimated 1,000 TPS​​.

Dencun Upgrade to Boost Ethereum Security, Efficiency, and Scalability

In addition to scalability and fee reduction, the Dencun upgrade should help the Ethereum ecosystem’s security and efficiency. The introduction of new EVM opcodes, as well as the deprecation of outdated ones, such as SELFDESTRUCT, aims to streamline data processing and bolster smart contract security. This upgrade could also expand the storage data bandwidth to 1 MB per slot, offering developers increased data storage capacity for exploring new use cases and applications​​

Dencun is as a critical milestone, promising to significantly improve Ethereum’s performance and user experience. By addressing some of Ethereum’s most pressing challenges, such as scalability and transaction costs, it could pave the way for broader adoption of Ethereum Layer 2s.

Accelerated Approval Process for Ether ETFs Promises Bright Future

The SEC looks likely to expedite its decision on Ether ETFs, contrasting with the extended timeline experienced with Bitcoin ETFs. The successful deployment of spot Bitcoin ETFs since January 11 has set a precedent that a similar Ether-based product could significantly attract capital to ETH, the world’s second-largest cryptocurrency by market cap.

The shift in focus from Bitcoin’s recent peaks to the prospect of an ETH ETF may encourage institutional investors to broaden their Ether holdings. Such a shift could stabilize liquidity at higher price points, fostering long-term price surges. The anticipation of heightened institutional engagement and capital influx suggests Ethereum could expand further, reinforcing its status in the cryptocurrency hierarchy.

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