Ethereum (ETH) is now on its way to $2,400, in a strong rally tied to the interest around the upcoming Dencun upgrade. At the moment, core ETH developers have begun the final phase of implementation by launching the upgrade on the Holesky testnet.
According to an X post from Ethereum execution client Nethermind, the Dencun upgrade went live on Holesky sometime around 6:35 am ET. Another post from developer Parithosh confirmed the finalization hours later. The upgrade was previously launched on the Goerli testnet weeks ago on January 17, and later on the Sepolia testnet on January 30. The mainnet deployment is expected to be sometime in March, to be decided after the Ethereum All Core Developers call scheduled for tomorrow.
Proto-Danksharding via Ethereum’s Dencun
The upgrade is expected to bring several important enhancements to the Ethereum network. Specifically, members of the ETH community can expect improvements in the network’s scalability through proto-danksharding and a reduction in transaction costs. These improvements support network growth and scalability, increasing the chance of adoption, especially when compared with other crypto networks.
Proto-danksharding (EIP-4844) is a new feature that introduces “blobs” to the network. These blobs allow Ethereum nodes to temporarily store and access a large volume of off-chain data, which reduces storage needs. The process will significantly reduce the costs of transactions applicable to decentralized applications (DApps), especially for layer-2 rollup chains.
The ETH Market
According to CoinMarketCap data, ETH is currently trading at $2,371 after climbing 3% in seven days, and more than 2% in 24 hours. A recent analysis by popular crypto analyst Michael van de Poppe is so bullish on ETH that he has set a $3,500 target. According to the analyst, the focus on Dencun will pump ETH’s price as it would ultimately reveal that the world’s second-largest asset by market cap has been undervalued.
While van de Poppe maintains his bullishness, the circumstances around spot ETH exchange-traded funds (ETFs) approvals give some cause for pause. So far, several prospective issuers have submitted applications to the United States Securities and Exchange Commission (SEC) to approve spot ETH ETF. However, the SEC is unsurprisingly reluctant.
During a media briefing last month, SEC Chair Gary Gensler noted that the approval of spot Bitcoin ETFs only applies to the king coin. Gensler said that no one should take the approval to mean that there are broader implications, especially regarding other digital assets.
Recently, the SEC postponed deciding on the proposed ETH ETF application submitted by Galaxy Digital and Invesco. Last December, the Commission had announced a delay, and is now instituting proceedings to determine whether or not to approve the application, according to an official filing.
Last month, the SEC delayed BlackRock’s application, stating that it needs more time to consider the proposal and all issues raised. In the same month, the Commission also delayed applications from Grayscale and Fidelity.
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