The Price of Ether (ETH), the native cryptocurrency of the Ethereum blockchain network, hit a new record on January 25.
At the same time, technical analysis shows that the ETH / BTC pair is breaking out of its multi-year downward trend and hitting the highest levels since September 2019, which should be good news for altcoins in general.
The higher highs come less than a week after ETH / USD finally hit its all-time high, more than $ 1,400 for the first time in three years.
The sense of the community is extremely positive
Sentiment around Ethereum has turned significantly positive after ETH managed to break its previous record January 2018 price.
Anthony Sassano, a longtime Ethereum investor and the head of marketing at Set Protocol, said the rally is representative of the groundwork developers have been doing in the Ethereum ecosystem over the past three years.
During the 2019 bear cycle, ETH was hit hardest among other large-cap cryptocurrencies. It consistently underperformed against BTC and struggled to gain momentum upward.
“This may be hard to believe, but the main reason why a $ ETH price hike makes me so dizzy is not the profits. It’s the fact that so many dedicated Ethereum community members have spent 3 long years building during a brutal bear market. And now their work is being rewarded. “
Data about the chain also shows a similar trend in addition to many other indicators which suggest that the ETH price hike may be just beginning.
For example, according to Santiment researchers, development activity on Ethereum followed a similar trajectory to the price of ETH.
This trend shows that the ongoing ETH rally is led by strong fundamentals and high developer activity, making it more sustainable. The researchers said:
“Both #Bitcoin and #Ethereum made respective dominance over each other here in January. We just noted that the development activity of each project # Github fluctuates widely with the respective price of $ BTC and $ ETH. “
What happens now?
After the rally, analysts say the momentum of ETH and the network effect of the Ethereum network shows that it is a blue-chip asset in the cryptocurrency market.
Alex Saunders, a cryptocurrency investor, said “most agree” on Ethereum’s qualities as a blue-chip asset. He said:
“2 years ago, $ ETH fell 90% in 9 months to reach $ 80. Most had written it off. But here we are at a new ATH $ 1500, the network effects are undeniable and most would agree it’s a blue chip. Love it.”
In the near future, there are two scenarios for ETH. The price of ETH could rise following the February CME futures listing due to a large inflow of institutional capital.
On the other hand, ETH could also see a drop after breaking from its all-time high as the momentum of the ETH / BTC pair cools. For example, the pair pulled back on January 21, shortly after Ether broke its all-time high in the USD pair.
It has to be argued that the Bitcoin dominance index is starting to recover after a two-month altcoin season, which could lead to ETH seeing a consolidation phase in the near term.