Although the price of Ethereum (ETH) has recently reached a seven-month high, demonstrating an increase in demand, the network hasn’t seen an increase in transaction fees, which indicates that the value of the Ethereum coin could continue to grow.
Indeed, Ethereum briefly crossed the $1,840 mark, which it hasn’t done since August 18, 2022. However, its network transaction fees have dropped to below $2 despite high demand, according to the data by the cryptocurrency market intelligence platform Santiment published on March 20.
As the platform’s chart indicates, Ethereum fees on March 19 fell to $1.75 as the price reached $1,842. By comparison, the network fees recorded a substantial increase to $8.12 on March 11, right after the price of the cryptocurrency had bottomed at $1,380.
According to the platform’s analysts, this means that Ethereum has paved the way toward reaching $2,000 and continuing upward:
“Ethereum’s price hadn’t eclipsed $1,840 since August 18th. Despite this 7-month high, the network hasn’t appeared to heat up and create notable transaction barriers due to high demand. This is a good sign that ETH has a door open to $2k and beyond.”
Ethereum price gains
At press time, Ethereum was seen changing hands at the price of $1,787, demonstrating an increase of 0.57%, in addition to the weekly and monthly gains of 13.12% and 5.86%, respectively, as indicated by the latest charts retrieved by Finbold on March 20.
It should also be noted that the supply of the second largest digital asset by market capitalization has been reduced by 66,000 ETH in 2023, making it deflationary and attractive to crypto traders and investors seeking scarce crypto assets with the belief that this scarcity could strengthen their value.
Furthermore, the crucial Shanghai upgrade (also known as Shapella), which is set to go live on the Ethereum mainnet on April 12, could provide a significant boost for the price of ETH, as it promises to enable validator staking withdrawals and introduce other major improvements.
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