Why The Recent Ethereum Price Gain is Set to Continue

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Introduction

For Ethereum, 2021 has been a year full of mixed fortunes. It all started with a huge bull run that saw its price hit over $4,200 during the first half of the year. This jump was later followed by a huge price correction resulting in price halving.

Soon after, the market seems to be on a recovery journey. Every day, it is edging closer towards getting back to its all-time high in May. This time though, the market seems poised to get even higher.

Several factors are supporting this gain and most of them will be key to sustaining in the future.

High Inflation levels

Inflation levels have been on a steady rise since the beginning of the year. High inflation levels are detrimental to the general economic outlook. This has made the prices of some economic sectors like housing increase steadily.

During inflation times, most investors tend to hedge their investments with safer assets such as commodities and cryptocurrencies. Being a cryptocurrency, Ethereum is among the many assets investors are investing in.

High inflation is also causing doubts in the stock markets. Some analysts are sounding alarm bells for investors to divest from stock because of a possible crash. Whether the crash happens or not, a huge amount of investments will keep flowing into assets such as Ethereum due to that element of fear.

Why a $10,000 Ethereum is possible in 2022

Supply Factors

Though Ethereum has no limit in supply, there are conversations regarding introducing one. Supply is a key element in pricing as a decrease in supply with an increase in demand causes the price to rise. The possibility of having a cap is already exciting for investors. This is resulting in more investments into Ethereum in anticipation of future price gains.

London Hard Folk

This refers to the update done on Ethereum recently. Among the many reasons for the update, the key one is to limit and burn some coins in circulation.

“Burning” in the market means reducing supply. this reduction is excepted to continue boosting the price due to reduced demand.

Growth in the NFT market

The non-Fungible Tokens market keeps expanding as demand rises. In September alone, the NFT market transacted over $500 million. This indicates a market growing from strength to strength.

You might be wondering what Ethereum has to do with the NFT market? Well, Ethereum is the biggest market driving the usage of NFTS.

NFT concept involves the use of blockchain technology to exchange some assets such as art. This is enabled and driven by the Proof OF Ownership concept on the Ethereum network.

It automatically means that users transacting in NFT have to do it through Ethereum coin Ether. As a result, this pushes demand increasing in price.

Why A Stock Market Crash Would Be Good for Ethereum

Increasing Competition

There is an increase in the number of players joining the NFT market as Ethereum competitors. This is an indicator that a huge potential exists in this market. An increase in competition is a sign of huge demand for the product offering. An example of such a competitor is Solana.

Conclusion

These factors will be key in sustaining a higher Ethereum price going forward. Some investors agree that the bull run is already underway. Nobody knows how long it will last but there are some who predict it could get as high as $13,000.

Is There a Possibility of Ethereum Price Hitting $10,000 in The Near Future?