Key Takeaways:
- A bullish fractal from 2017 suggests Ethereum might reach a price of $17,000 in 2022.
- Ethereum’s upcoming switch to proof-of-stake adds bullish tailwinds to its price action.
NEW DELHI (CoinChapter.com) — Ethereum’s native token Ether (ETH) is likely to reach $17,000 this year if a bullish fractal from 2017 plays out.
According to an analyst who goes by the moniker Moustache on Twitter, ETH’s price painted an “ascending triangle” in 2017. Afterward, the alpha altcoin broke out to reach over $1,004, an increase of almost 275% from the breakout price level above $250.
Interestingly, Ethereum prices have been moving in a similar pattern since 2021 began. Moustache noted that the “reaccumulation period could last about 3x longer in ’21-’22 than in ’17-’18.”
As a result, the analyst believes ETH is likely to target price levels near $17,000.
Up till 2017, Ethereum was a nascent technology with several bugs, and companies were unwilling to try out the new smart contract platform. However, ETH prices did swing between $1 to $7 in 2016, reaching a high of $11 before the infamous DAO hack.
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Regardless, Ethereum began 2017 after sorting out most of the bugs in its platform. As a result, startups took an interest in its smart contracts offering, using the blockchain platform to create tokens with relative value to ETH, also called Initial Coin Offering.
As the blockchain startups started booming, they drove ETH prices up.
Ethereum Has Fundamentals Lined Up — BUT
Not unlike 2017, interest in Ethereum is gaining in 2022, mainly due to the upcoming switch to the Proof-of-Stake (PoS) consensus mechanism. In hindsight, high gas fees and slow transaction speeds have been an issue for the Ethereum blockchain.
These issues have given birth to several Ethereum competitors, grouped under the moniker “Ethereum Killers.“
However, with the upcoming merge to PoS, Ethereum plans to solve its issues of network congestion and temperamental gas fees. In addition, with the burn mechanism in place since Aug 2021, ETH prices would likely increase due to the resulting decrease in supply.
But, Ethereum’s correlation to BTC is near its all-time highs at 0.76. With Bitcoin’s digital gold narrative failing to hold to its name, Ethereum risks following BTC’s stock correlation price action. In hindsight, BTC Nasdaq 100 reached an all-time high on Jan 25.
The top cryptocurrencies mirroring stock price action might dampen some bullish fundamentals favoring Ethereum. In addition, the ongoing tensions between Russia and Ukraine highlighted the crypto-stocks correlation, with crypto markets falling in tandem with the traditional financial markets.
Also Read: Ethereum (ETH) dump ahead? Veteran investor says yes.
Meanwhile, the various economic and trade sanctions against Russia might force the country to seek alternative safe-havens. Though the Ruble crashed after the sanctions, Russia controls a significant share of the world’s oil supply.
Additionally, the U.S. dollar lost its image as a haven. President Biden’s recent decisions are likely to make central banks think twice before buying U.S. treasuries. As such, cryptocurrencies like Ethereum and Bitcoin could likely be a viable option.
Ukraine already adopted cryptocurrencies in its bid to raise funds to repel Russia’s attack. Traditional economic institutions searching for new financial havens could look into Ethereum and other cryptocurrencies, driving their adoption and, consequentially, their prices.
At the time of writing, ETH was trading at $2,594, up 4.03% on the day.
