- Data shows that Ethereum (ETH) has entered a deflationary phase, burning millions of tokens ahead of the anticipated bull run.
- The imminent approval of an ETH spot ETF, Ethereum network upgrade, and the upcoming Bitcoin halving will set the stage for an ETH rally.
Ethereum (ETH) continues to attract investor interest ahead of the next bull run. According to the latest data, the Ethereum network has successfully burned $13 million worth of ETH, fulfilling its mission as a deflationary asset.
Over the past month, the network has sent 74,933.24 ETH, worth roughly $13 million, into its dead wallets, significantly reducing its circulating supply. In the same period, 69,313.86 ETH were issued by the network. This data suggests that the digital asset has entered a deflationary phase.
A deflationary asset inherently ensures that its available supply is decreasing, suggesting that demand is always higher than supply, leading to price increases. Ideally, this is designed to boost prices.
This development coincides with approximately 29.39 million ETH coins staked on the blockchain, representing nearly a quarter of the total circulating supply. This signifies interest from investors and trust in the health and security of the network.
In the past 30 days, despite the highs and lows that have characterized the volatile time in the crypto market, ETH has managed to record a 3.6% increase. At the time of this writing, ETH is down by less than 1% in the last 24 hours but up by nearly 2% in the last 7 days.
Upcoming developments around the network are setting the stage for ETH to go on a rally that could easily see the second-largest cryptocurrency by market cap reach an all-time high. One of these is the upcoming Dencun upgrade.
As CNF reported, Ethereum core developer Tim Beiko stated on Reddit that the recent testing of the upgrade has been successful. On Thursday, Feb. 8, Ethereum developers are likely to announce the mainnet launch date for the Dencun upgrade.
The crypto community is further watching developments around an ether spot ETF. Some experts believe that an Ethereum ETF will be approved in May when the deadline for some applicants hits, but others remain pessimistic and believe the approval could be at least two years away.
Additionally, there is renewed bullish optimism based on the Bitcoin halving scheduled for April. Historically one of the most bullish events, its hype has trickled into other cryptocurrencies, leading to their rallies. Experts foresee Bitcoin (BTC) reaching a new all-time high of over $100,000 by the end of the year, with a similar rally expected for ETH as well.
Ethereum investors will be watching the $4,878.26 all-time high reached around two years ago. Interestingly, following the positive performance and developments, the largest altcoin by market cap is only 52% below its all-time high. Although a majority of experts foresee an upward trajectory from current positions, crypto analyst Benjamin Cowen has warned of a drop to $1,000 before rallying to an all-time high based on its cyclic patterns.