$4000 For Ethereum? Here's Why it's Not Impossible

Ethereum (ETH) is currently in a complex phase, caught between a drop, poor performance, and a critical resistance level. Currently, ETH is trading around $3,241, a decrease of about 33% from its all-time high! However, for Ethereum to return to the record level of $4,878 reached in November 2021, several significant changes will need to be made, or the cryptocurrency risks experiencing an even more pronounced decline.

Crypto: Ethereum Facing Disastrous Performances

Ethereum, the second-largest cryptocurrency by market capitalization, is currently trading at $3,241 after a nearly 2% drop in the last 24 hours, with increased resistance at $3,400. To make matters worse, other layer 1 blockchains are catching up to Ethereum in terms of applications, use cases, fees, and amounts staked, according to Aurelie Barthere, senior analyst at Nansen.

Furthermore, the circulating supply of Ethereum has also increased by 12,353 ETH, reaching its highest level since February 2023. Meanwhile, crypto network activity has decreased, with a 4% drop in unique addresses and a 1% decline in daily transactions. These trends could exert additional downward pressure on the price of ETH.

How to Reverse This Trend?

To reverse this gloomy trend, Ethereum must stimulate fundamental activity on its blockchain. Indeed, increased collaboration with the public and private sectors, particularly in the United States, could promote its crypto adoption. For example:

• The DOGE led by Elon Musk could use the Ethereum blockchain for solutions for tracking expenditures and financial management of the U.S. government.
• Joseph Lubin, co-founder of Ethereum, suggested that the Trump family might consider starting a crypto business based on ETH, which could enhance its adoption.

Moreover, the volume of trading in the options market has exploded in a month, indicating a possible recovery. However, to initiate a real uptrend, it is crucial for Ethereum to break the resistance at $3,400. A daily close above this level could lead to a short position liquidation worth over $1.09 billion, paving the way for a surge toward $4,000.

Despite current performances, Ethereum remains a major force in the crypto world, but it must overcome significant challenges to reach its ATH. With well-defined strategies and increasing adoption, Ethereum has every potential to surpass $4,878.