Here Are The Major Developments That Could Drive Ethereum Price Back Above $4,000

Scott Matherson

9 months ago

3 mins read

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Ethereum, the second largest crypto by market cap, is trading at $2,420 after a recent price rally. Ethereum has been up by 3.4% and 6.3% in the past 24 hours and seven days, respectively, which has raised hopes for an extended bullish run. As the price performance continues to unfold, some major developments are taking root, which could pave the way for Ethereum’s price to rally back above the $4,000 mark.

Stablecoin Transaction Volume Hits New High

Despite the bearish sentiment which has lingered in a 30-day timeframe, on-chain data shows that the Ethereum blockchain continues to witness massive activity, especially in the stablecoin niche. The stablecoin trading volume on the blockchain soared massively in August to break its previous all-time high. Particularly, the stablecoin trading volume reached $1.46 trillion.

This surge in stablecoin activity further solidifies Ethereum’s position as the go-to blockchain platform in the world of DeFi. As stablecoin adoption continues to rise, this could drive up Ethereum revenue due to demand for ETH tokens used to pay transaction fees. This increased utility could, in turn, contribute to its price reaching $4,000 or beyond.

Watch Out For The 0.015 Point In Funding Rates

Another key factor to watch now for Ethereum is the funding rate. The funding rate is a metric that tracks the cost of holding a long or short position in the perpetual futures market. Funding rates reflect market sentiment, as positive funding rates indicate that longs are paying short positions, suggesting a bullish outlook, while negative rates show a bearish trend.

According to on-chain data from CryptoQuant, the Ethereum funding rate is approaching the 0.015 point. As an analyst at CryptoQuant pointed out, the Ethereum funding rate is currently hovering between 0.002 and 0.005. This movement is reminiscent of a pattern in September 2023, when the funding rate was similarly low.

Although these figures might appear modest for a typical bull market, a CryptoQuant analyst has noted that this could be the calm before a major upward movement. This is because the funding rates eventually crossed 0.015 in 2023, allowing Ethereum to “surge from the $1,500s to $4,000s.” A similar occurrence could see Ethereum surging massively to $4,000 in the next few months.

Ethereum: Network Growth

According to Santiment, the Ethereum network has witnessed massive growth in the past week, recently reaching a four-month high. Apart from its L2 solutions like Optimism and Arbitrum, the platform remains the foundation for decentralized finance (DeFi) and non-fungible tokens (NFTs). This network growth was accompanied by an increase in the creation of wallet addresses and active addresses.

At the time of writing, Ethereum is trading at $2,421. If these factors above align in favor of Ethereum, we could see ETH continue to approach the $4,000 mark.

Featured image from StormGain, chart from TradingView

Scott Matherson

Scott Matherson is a prominent crypto writer at NewsBTC with a knack for capturing the pulse of the market, covering pivotal shifts, technological advancements, and regulatory changes with precision. Having witnessed the evolving landscape of the crypto world firsthand, Scott is able to dissect complex crypto topics and present them in an accessible and engaging manner. Scott's dedication to clarity and accuracy has made him an indispensable asset, helping to demystify the complex world of cryptocurrency for countless readers.

Scott’s experience spans a number of industries outside of crypto including banking and investment. He has brought his vast experience from these industries into crypto, which allows him to understand even the most complex topics and break them down in a way that is easy for readers from all works of life to understand. Scott’s pieces have helped to break down cryptocurrency processes and how they work, as well as the underlying groundbreaking technology that makes them so important to everyday life.

With years of experience in the crypto market, Scott began to focus on his true passion: writing. During this time, Scott has been able to author countless influential pieces that have drawn in millions of readers and have shaped public opinion across various important topics. His repertoire spans hundreds of articles on various sectors in the crypto industry, including decentralized finance (DeFi), decentralized exchanges (DEXes), Staking, Liquid Staking, emerging technologies, and non-fungible tokens (NFTs), among others.

Scott’s influence is not just limited to the countless discussions that his publications have sparked but also as a consultant for major projects in the space. He has consulted on issues ranging from crypto regulations to new technology deployment. Scott’s expertise also spans community building and contributes to a number of causes to further the development of the crypto industry.

Scott is an advocate for sustainable practices within the crypto industry and has championed discussions around green blockchain solutions. His ability to keep in line with market trends has made his work a favorite among crypto investors.
In his personal life, Scott is an avid traveler and his exposure to the world and various way of life has helped him to understand how important technologies like the blockchain and cryptocurrencies are. This has been key in his understanding of its global impact, as well as his ability to connect socio-economic developments to technological trends around the globe like no one else.

Scott is known for his work in community education to help people understand crypto technology and how its existence impacts their lives. He is a well-respected figure in his community, known for his work in helping to enlighten and inspire the next generation as they channel their energies into pressing issues. His work is a testament to his dedication and commitment to education and innovation, as well as the promotion of ethical practices in the rapidly developing world of cryptocurrencies.

Scott stands steady in the frontlines of the crypto revolution and is committed to helping to shape a future that promotes the development of technology in an ethical manner that translates to the benefit of all in the society.

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