Ethereum Hits $3800 for the First Time Since December 2021
Date: 2024-03-06 Author: Dima Zakharov Categories: BLOCKCHAIN
Ethereum Hits New Milestone
In a significant development for the cryptocurrency market, Ethereum, one of the leading digital currencies, soared above $3800 on Wednesday morning. This surge marked its highest price point since December 2021.
Market Performance and Trends
At the time of reporting, Ethereum's price slightly receded, trading at $3796.53, reflecting a 2.8% increase over the day, according to CoinGecko data. The last instance of Ethereum trading above $3800 was on December 29, 2021, as per price tracking websites.
Factors Driving the Surge
The sudden uptick in Ethereum's price is attributed to its market capitalization exceeding $116 billion earlier this week, marking a 9% increase since the beginning of the year. Presently, there are 31,320,207 ETH in circulation, valued at over $119 billion at the current ETH price.
Anticipation for Network Upgrade
The positive momentum surrounding Ethereum coincides with the anticipation of the DenCun network upgrade scheduled to transition to the mainnet on March 13. DenCun will introduce proto-sharding to Ethereum, aimed at reducing transaction costs for layer 2 blockchains, addressing scalability issues.
Impact of DenCun Upgrade
Upon full integration, DenCun is expected to enable Ethereum to process over 100,000 transactions per second at a reduced gas fee by 75% for layer 2 networks. This could potentially alleviate user gas expenses in layer 2 networks for crypto companies.
Additional Enhancements with DenCun
The DenCun upgrade also introduces "big binary objects" to compress transaction data off-chain, minimizing storage and processing costs in Ethereum. Furthermore, the EIP-7044 proposal will allow ETH validators and stakers to retain instructions on exiting their positions automatically in case of node inactivity, thus avoiding escalating penalties for transaction processing failures.
