Summary
- A new update on Ethereum, expected to be launched in July, will propel prices in the coming months.
- Institutional forces remain the most powerful drivers for ETH/USD.
- Regulatory forces and security threats could present a hindrance to growth.
ETH broke its resistance level that persisted during the weekend as a result of a bullish trend. The price is now up by over 2% in the past 24 hours. During that time, the market capitalization has risen to nearly $200 billion from $190 billion. The anticipated upgrade on ETH is expected to accelerate the price ascent of this cryptocurrency as we approach July.
Institutional adoption of fuel growth
Institutional forces remain the most significant drivers of cryptocurrency prices in 2021. The more institutions buy or adopt a cryptocurrency, the more acceptable it becomes, and the higher its price rises. In Ethereum’s case, smart contracts and DeFi are the new gold mine.
This week, Mogul introduced DeFi and NFTs to the film industry, breaking ground in yet another niche market. Using the platform, the company announced the particulars of a forthcoming event on the ETH blockchain. Mogul is also offering access behind-the-scenes through Ethereum tokens (NFTs) and DeFi. This is the first instance in the market, highlighting Ethereum’s angling for the film industry’s billions of dollars.
It also seems that companies are not slowing down on the emerging trend of adding cryptocurrencies to their balance sheets. Yesterday, Meitu, a popular Chinese Beauty App, added $15,000 ETH worth more than $ 20 million to its asset inventory.
Additionally, video-gaming giant Atari earlier today announced plans to partner with Decentraland to launch a crypto casino in ETH.
Elsewhere, Yield App, a DeFi-based wealth management platform, yesterday launched an Ethereum fund. The fund will enable the app’s users to earn higher interest on their ETH tokens and is expected to encourage depositing the small amounts of Ether.
In a new development by ETC Group, the investment group will be launching an ETH Exchange-Traded Product (ETP) on Deutsche Borse’s Xetra tomorrow. This is seen as part of its diversification plan, following an earlier launch of Bitcoin ETP.
An upgrade and a cause for concern
A new update on Ethereum is set for launch in July. The update, EIP 1559, is believed to be designed to make ETH a deflationary asset. As with the recent launch of Ethereum 2.0, the update will trigger price movement higher.
While the market waits for the update, a new threat has come into force. Ethereum faced a hacking threat a few days ago, leading to the loss of nearly $3 million via the DeFi platform PAID Network Protocol. Such vulnerabilities add an element of fear to digital currencies, which are already struggling with low approval from skeptics.
A welcoming environment for cryptocurrencies
Even as hacking threats emerge, governments are progressively easing restrictions on digital currencies. The world’s second-most populous country, India, this week demonstrated its intention to reverse an earlier stance that had proposed a total ban on all private cryptocurrencies.
ETH/USD technical outlook
Over the past few days, the ETH/USD pair was resting at the resistance level of about $1,700. The resistance level has since been broken, and ETH will find first support at $1,665 and second support at $1,774.
An above-midpoint Relative Strength Index (RSI) indicates that the market is leaning towards the bulls. The first resistance will be encountered at $1,900, and the second one will be at $1,908.
