As the fervor around Bitcoin and other cryptocurrencies begins to subside, Ethereum (ETH) remains resilient, refusing to sink to lower lows, particularly when compared to Bitcoin (BTC). In a recent analysis shared by decentralized finance (DeFi) expert DefiIgnas on December 8, signs point towards a potential Ethereum price rally that could see the second largest cryptocurrency outperform BTC.
Factors that Could Fuel Ethereum’s Bull Run
DefiIgnas highlighted that, despite ETH falling 24% against BTC in 2023, several key indicators hint at an impending turnaround. A primary reason is the increasing interest of crypto investors in the discounted Grayscale Ethereum Trust (GETH), which has seen a surge in recent months, outperforming the spot prices of Ethereum.
- GETH has seen a 298% rise in the past few months, while ETH has only increased by approximately 100% in the same period.
- As the price of GETH shares rose, the discount with spot ETH diminished, indicating an indirect flow of capital into ETH and subsequently a rise in demand.
Alongside the rise of GETH, the expert remains optimistic about Ethereum due to recent developments surrounding the approval of the first spot Bitcoin ETF. The crypto community anticipates that the Securities and Exchange Commission (SEC) will greenlight several products, including proposals from Fidelity and BlackRock.
According to DefiIgnas, the launch of the spot Bitcoin ETF, likely in early 2024, will shift the “attention, narrative, and speculation” towards the approval of the first spot Ethereum ETF. BlackRock, the world’s largest asset manager, has already filed an application with the SEC for the first spot Ethereum ETF.
The Impact of Ethereum’s Cancun Upgrade
The anticipated activation of the Cancun upgrade in H1 2024 is also expected to bolster Ethereum prices. Ethereum has undergone several upgrades over the years, including the transition from proof-of-work (PoW) to proof-of-stake (PoS) and a revamp of their fee auction mechanism, which introduced ETH burning.
However, the Cancun upgrade aims to directly enhance the main net’s capabilities by implementing several proposals, including EIP-4844 proto-dank sharding, which seeks to lower the gas fees associated with rollups. This update will further solidify Ethereum’s commitment to significantly enhance on-chain scalability and reduce gas fees over time.
Ethereum’s Current Market Position
At present, ETH remains strong against BTC, as evidenced by the candlestick arrangement in the daily chart. The direction of ETH’s price in the coming days will be interesting to watch. If the gains from December 7 are confirmed, ETH could see further increases, potentially breaking above the current consolidation as bulls aim to surpass the November 2023 highs of approximately 0.058 BTC.
For those interested in tracking the potential Ethereum price rally, applications such as cryptoview.io offer a comprehensive view of the crypto market, allowing users to keep a close eye on Ethereum’s performance.
