The price of Ether (ETH) broke out in its Bitcoin (BTC) pair for the first time in 23 days. What follows is a high profile announcement from Visa to use USDC, a stable coin based on the Ethereum blockchain.
Although ETH / BTC experienced a strong technical breakout, the uptrend was fueled by solid fundamental catalysts, fueling the short-term bull fall for ETH.
Traders believe Ethereum will outperform Bitcoin in April
According to the pseudonymous trader “Rekt Capital”, Ethereum has been on the verge of breaking out of its triangular market structure several times since January 2021.
Every time it tried to break out of it, ETH saw a pretty big rejection from the resistance area.
For the first time in almost a month, ETH is starting to exceed its resistance level at the top of the triangle. This is the third attempt at an outbreak in three months. The dealer said:
“Broke out of its triangle. But it has just rebounded into red resistance (last resistance before new all-time highs). And while that resistance might force ETH to retest the triangle … A successful retest would likely break in the past lead red. “
Rookie, another well-known pseudonymous trader, also said the technical market structure of Ethereum is optimistic.
The trader stated that they expect Ethereum to outperform Bitcoin from April to June as the ETH / BTC pair gradually gains momentum.
The ETH / BTC pair has stagnated steadily since early March, even as Bitcoin saw a strong upward trend to around $ 60,000.
Now the ETH / BTC pair has broken out for the first time since March 9 and has replenished its technical momentum on the way to $ 2,000. Rookie noted:
“We expect Ethereum to outperform Bitcoin for the entire second quarter.”
On-chain data is also bullish
Data from Glassnode shows that the number of active Ethereum addresses has hit a 1-month high of 33,257.
The increasing number of active addresses indicates that user activity on the Ethereum blockchain is increasing in parallel with the price.
For any blockchain protocol, the rally in the price of the underlying token, complemented by an increase in user activity, is an optimistic trend because a blockchain is at its core a value transfer network.
In addition, the total value of DeFi credits for Ethereum has steadily increased since 2020. A pseudonymous Ethereum investor and researcher named DCinvestor said:
“Believe it or not, this was a common refrain a few years ago when DAI went live. People didn’t get it and they didn’t make secured loans, but the numbers don’t lie now, it’s going to be the foundation of a new one Hypercapital’s efficient world is built on #Ethereum via #DeFi. “
As long as user activity on the Ethereum blockchain continues to increase alongside key metrics related to DeFi in Ethereum, ETH’s price would likely reflect the increasing demand for their blockchain network.
Since the main demand for ETH for ETH comes from DeFi to pay “gas” or transaction fees, DeFi’s popularity would catalyze Ethereum’s value.
EIP1559 is not priced in
– H DavidHoffman.eth (@TrustlessState) March 29, 2021
Commentators also say that the EIP1559 proposal, which is expected to go into effect in July, is not priced into the price of Ether, which would overhaul Ethereum’s fee market structure and indirectly result in ETH becoming scarcer.