The flow of cash from Bitcoin to the Ethereum market has contributed significantly to today’s price rise, according to Lewis Harland, a portfolio manager at Decentral Park Capital.
After consolidating for the past two weeks, the Ethereum (ETH) market has started to gain ground against Bitcoin (BTC) during the New York trading session on Tuesday. According to the latest crypto market data, the Ethereum price rose to a 24-hour high of around $1,886, up more than 3 percent on the day. With over $30 billion staked in the Ethereum ecosystem, the DeFi ecosystem is currently focused on the upcoming Shanghai Update, scheduled for April 12. Notably, the Ethereum Shanghai Update will allow withdrawals of more than 17.9 million ethers staked by more than 561k validators.
Following the recent breakout of Ethereum, Bitcoin’s market dominance shrank by about 0.2 percent on Tuesday. While Bitcoin’s market dominance sits at around 47 percent according to the trading view, Ethereum’s share is around 19 percent. However, its dominance is expected to shrink as more Dogecoin-led altcoins show signs of decoupling.
According to market data provided by Coinglass, more than $12 million of the Ethereum market was liquidated in the last few hours after the flash breakout. Furthermore, the breakout caught many traders by surprise who anticipated that the price would pull back before continuing the bullish rally.
Analyst Opinion on Ethereum (ETH) Market Outlook
According to Lewis Harland, a portfolio manager at Decentral Park Capital, crypto cash flow has recently favored Ethereum over Bitcoin. However, crypto analysts are closely monitoring the Ethereum market to ensure that today’s spike is a true breakout towards $2000. Also, the Ethereum price rise could be a false breakout leading to a stop hunt on short traders.
$ETH: We have not seen a 4-hour close above $1850 since August 2022.
All of the EMAs look quite healthy, let’s see if this is actually a real breakout. #ethereal pic.twitter.com/pivr6ppjlE
— Altcoin Sherpa (@AltcoinSherpa) April 4, 2023
According to Harland in a note to investors on Monday, the banking crisis has significantly bolstered the Ethereum market, which is a favorite among many institutional investors looking to take advantage of the DeFi ecosystem.
“ETH looks to regain ground against BTC as part of a broader capital rotation play with crypto likely to benefit from broader stock rallies heading into a historically bullish month,” Harland noted.
However, the Ethereum ecosystem, like other altcoins, faces heavy regulatory scrutiny in the United States after SEC Chairman Gary Gensler declared all digital assets aside from Bitcoin to be unregistered securities. According to Gensler, most crypto projects are not decentralized as they claim. Gensler told Congress that most crypto projects have people working on their success.
#Ethereum NOT A SAFETY CLASS ACTION https://t.co/EjsD0ZHwOG
— John E. Deaton (@JohnEDeaton1) March 10, 2023
In defense of Ethereum, famed crypto lawyer John E Deaton filed a class action lawsuit alleging that Ether is not a security. Additionally, all other altcoins risk being classified as unregistered securities in the United States if Ether and XRP are bundled as such.
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