Ethereum (ETH), the second-largest cryptocurrency by market cap, has risen again above the $1,600 level as the decentralized finance (DeFi) asset has seen a significant capital flow to its market cap over the past 24 hours.
Can Ethereum reclaim $2,000?
Ethereum is currently trading at $1,681, up 6.5% on the day, climbing to a five-month high, after briefly surging above $1,700, according to data from Feb. 16.
Ethereum 1-day price chart. Source: Finbold
Specifically, $1,700 is seen as the next key resistance level for Ethereum to reach upside and gain support. Currently, Ethereum has a market capitalization of $205.77 billion, adding more than $13 billion to its market cap, which has risen from $192 billion in the last 24 hours.
Ethereum 1-day market cap chart. Source: CoinMarketCap
Considering that the Shanghai upgrade is scheduled to go live in March and will allow for the phased release of staked ETH, investors will be hoping that Ethereum will get back $2,000 before the upgrade.
Specifically, prior to Ethereum’s Merge upgrade, the digital asset saw a massive influx of capital into what appeared to be a ‘buy the rumor, sell the news’ event. The Shanghai upgrade is seen by many analysts in the space as having a positive impact on the price of Ethereum, as it will offer investors more flexible staking alternatives such as liquid staking.
Institutions buy ETH
The narratives about Ethereum’s supply and demand dynamics, as well as staking, are not the only factors driving prices up. Institutions also flocked to the asset last week, according to chain detective ‘Lookonchain’.
On February 10, it was discovered that a number of funds and institutions have invested over $1.6 billion in the cryptocurrency market. Both Bitcoin and Ethereum reached new highs for 2023 today, which is a positive sign for both cryptocurrencies.
1/ Why did the price of $BTC/$ETH suddenly rise today?
We found that several funds/institutions poured nearly $1.6B into the crypto market since Feb 10!👇 pic.twitter.com/WRaSv4YtgP
— Lookonchain (@lookonchain) February 16, 2023
Meanwhile, the current circulating supply of ETH is 120.49 million. According to the UltraSound.Money follower, it has dropped 24,038 ETH, or about $40 million, since the Merger.
ETH supply since merger. Source: UltraSound.Money
To sum it up, the most likely scenario for ETH price prediction is a rise above $1,700. If this is accomplished, it could result in a push towards $2,000. On the other hand, if the price of ETH dips below $1,450, there is a potential for a drop as low as $1,300.
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