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*Ethereum price hovers above $2,500 on Friday after soaring nearly 100% since early April’s bottom.* Pectra’s Power Surge: 11,000 Ethereum Wallets & dApps Have Adopted This New Authorization Standard in Just One Week! This ETH upgrade is a catalyst for speedy adoption, indicating a very loud adoption about a loud change in how we use the blockchain.
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*The growing stablecoin usage and tokenization, Layer 2 institutionalization and ETH short unwind support the price rally.*
Ethereum is back in style! It rose out of the doldrums for months, reborn like a phoenix-like. On Friday, it flirted with a price level around $2,500, rising from its floor in early April, nearly 100% in riotous speed. Could this be a new era for ETH?
Pectra has landed with all guns blazing! Over 11,000 EIP-7702 authorizations have blended through in just seven days with wallets and dApps already juicing up its power. Get ready for liftoff!
Yet more bull winds roar at the crypto park! The potent cocktail of soaring stablecoin activity, institutions rushing into Ethereum Layer 2, and the short squeeze on ETH is enough to stir up a new optimism. But is this one geared toward greatness? FXStreet did a deep dive into the leading crypto experts to get the scoop on the surge.
* Ethereum’s Pectra upgrade boosts authorizations *
On May 7, the network witnessed the famous Pectra upgrade; and here comes adoption: abuzz! Just one week in, and Dune Analytics shows a spectacular flurry of activity, an explosion of more than 5,520 transactions and 11,055 authorizations roaring through this new framework. Wallets and dApps are wholeheartedly jumping in, giving a powerful vote of confidence to this last evolutionary step on the part of Ethereum.
Just after launching the Dencun upgrade of last year, Pectra upgrade comes in with some three must-have changes: user-friendliness, scalability enhancement, and a reliable staking infrastructure.
Kan, COO of Bitget Wallet, foresees a userfriendly Web3 landscape powered by Ethereum’s Pectra upgrade. Kan, speaking exclusively to FXStreet, elaborated that Pectra can unleash powerful capabilities like gasless transactions and sessionbased permissions, attracting a fresh wave of users.
“The key,” Kan said, “is really simplifying all of Ethereum’s complexity. Wallets with, say, intuitive experiences; clear approvals; familiar login prompts; and safety net checks will bridge the gap between developer tooling and consumer software.”
Pectra’s impact goes beyond just the user experience. By lowering Layer 2 fees, it may become an impetus for increased onchain activity. Kan also felt infrastructure was key and profits will go to those wallet solutions that scale with faster confirmations, and straightforward L1/L2 bridging, and frictionless dApp interactions. “Performance, not just features,” Kan concluded, “will be the defining factor in this new landscape.”
* Signs of a comeback *
Frenzy Unleashed by Ethereum: At $1,385 in April, the market was asleep; come May, the first phase of its run brought it to a high of $2,738! Bitcoin and other Layer 1s stole past spotlight early this season, whereas Ethereum quietly filled its rocket fuel storage. All of a sudden, it very nearly doubled from its April lows, asserting that the sleeping giant has woken up.
Ethereum’s price surge is underway, and, while presiding Gautam Chhugani and his analysts at Bernstein are assigning a three-pronged set of causes: It is not the passing hype when the rally is powered by Ethereum claiming its right as mainstream infrastructure. Think stablecoins and think tokenized assets. Exploding adoption is reinvigorating the fundamental purpose of the network. Proof: Stripe’s massive $1.1 billion bet on Bridge. Or Meta’s doubling down on stablecoins. Beyond mere survival, Ethereum is definitely thriving.
Ethereum: Stablecoins’ King in the Hill. Data by DeFiLlama would serve to bring clarity to the matter-Ethereum is unarguably the champion with around 51% of the entire stablecoin supply. With this dominance, it is poised to reap the rewards as the rise of stablecoins continues.
Total Stablecoin by chain chart. Source: DefiLlama
Layer 2 solutions were never really a sideshow for Ethereum but are now the main stage when it comes to institutional crypto. Just look at Base, making cash like there’s no tomorrow (check out the graph below as a sort of evidence). Robinhood, meanwhile, has bought Wonderfi in what can only be a hint at an incarnation of tokenized stocks twirling on the Ethereum blockchain. This is not evolution; this is the revolution.
Layer 2 projects revenue in the past 365-day chart. Source: Token Terminal
Ethereum’s ascent isn’t just about new money; it’s a strategic retreat. Hedge funds, once betting against ETH to balance their Bitcoin and Solana plays, are now throwing in the towel. As Ethereum’s core strengths shine brighter and the market’s spotlight swings its way, these former short positions are being abandoned, fueling an even faster surge in ETH’s price.
The Christmas rally in Ethereum is gaining momentum! The Derive.xyz analysts are bullish and have doubled the chance of ETH crossing $4,000 by Christmas to a batter 20%. And $5,000 is in cloche? They put it at a 12% chance. But the real stocking stuffer? The odds of ETH falling below $1,500 have crashed from a worrisome 40% to a negligible 15%. Is Santa bringing an ETH bull run this year?
* Technical outlook suggests rally continuation as 200- w eek EMA holds strong *
Ethereum bulls are charging! After a period of dormancy for many weeks, Ethereum finally broke a key downtrend that was present since December. Breaking out in early May, the price almost surged by 39%, surging above the crucial 200-week EMA ($2,243). The rally would never be told. As of Friday, Ethereum is pushing above the $2,500 mark and has added another 3.26% this week, signaling strong momentum and renewed investor confidence. Could this be the dawn of a major comeback for Ethereum?
The bulls are gathering strength! The weekly chart flashes green, RSI flexing its muscles at 53 and aiming higher, showing increased buying interest. But the real kicker? The MACD gave an emphatic buy signal this week with a bullish crossover, thereby confirming the uptrend and setting the stage for gains ahead. Let it soar!
Ethereum’s bulls have their sights set on a resistance level at $2,746. This is a crucial price level that represents the 50% Fibonacci retracement from its December highs to its April lows. Clear this resistance on the weekly chart, and a rally towards $3,067, the 61.8% Fibonacci level, can be unrestrained. Can ETH clear this hurdle and rewrite its recent past?
ETH/USDT weekly chart
Ethereum bulls, hold on! If ETH price is to crack below the crucial $2,243 support, which is also the 200-week EMA, and stay underneath for the duration of a week, it spells punishment. The last line of defense would then be the psychologically significant $2,000 price point.
* Experts’ insights on Ether eum *
To gain more insight, FXStreet interviewed some experts in the crypto markets. Their answers are stated below:
* Marcin Kaźmierczak, Co-founder & COO at RedStone Oracles *
* Q: How critical is Ethereum’s dominance in stablecoins to its long-term valuation? *
Ethereum enjoys control so long as it holds strong in stablecoins-the blood of on-chain finance. Any loss of share to Solana or any other crypto along the stablecoin line would put some shade on the absolute invincibility which the market has seen for Ethereum so far. But layer-2 vs. layer-1 is what muddles the waters. The scaling roadmap puts layer-2 first, yet most ETH-burning activity today is layer-1, paving way for present revenue-layered on a future vision.
* Q: Can Ethereum compete with Bitcoin as a store of value, or should it focus solely on utility? *
Ethereum Genius is not “or.” It’s the engine that powers tomorrow’s on-chain economies,anda digital gold reserve secured by fervent, continuing advances in technology. This dual nature-utility plus value-is her uncopyable advantage, and the basis for unfaltering long-term conviction.
* Q: Is Ethereum the clear winner in real-world asset tokenization infrastructure? *
At present, we witness nearly 80% of tokenized assets hosted on Ethereum. Institutional confidence and a mature toolkit paved the way. But the DeFi landscape is changing. As the adoption of decentralized finance increases, a bad user experience and high costs will become prominent pain points. This, thus, paves the door for competitivity and Layer-2 solutions in case Ethereum falters in its scaling efforts. The crown is not necessarily guaranteed.
* Jaehyun Ha, Research Analyst at Presto Research *
* Q: What drives Ethereum’s recent 100% rally since April fundamentals or positioning? *
Ethereum surge? Not quite because the revolution hasn’t arrived yet. Pectra’s updates-scalability bumps, stake sweetening, and a UX facelift-are still on a low simmer. Therealfuel? Enter crypto fatigue with a little sprinkle of FOMO. Mid-summer, with ETH/BTC hitting rock bottom alongside a well-timed pep talk from the top brass, there was a native crypto rotation. ETF inflows? Barely a trickle. In other words, this rally is an in-house crypto affair, and Wall Street hasn’t swung by yet.
* Q: How critical is Ethereum’s dominance in stablecoins to its long-term valuation? *
As it were, Ethereum’s supremacy as the chief settlement layer has been challenged. The series of fast blockchains led by Solana have been nibbling at its heels. The real battle for Ethereum’s future has thus always stood for its very unique qualifications: the power of interconnected applications (composability), its strong security mechanism as the ultimate questioner of transactions, and its aptitude to host heavyweight level stablecoins, even ones backed by governments (like a Korean Won stablecoin). Being on the stablecoin throne is good, but the real, long-term value of Ethereum lies in becoming the essential and immutable base layer for the digital economy.
* Q: How much upside does Ethereum gain from Layer 2 adoption and revenue growth? *
Layer 2 scaling solutions are now ready for use on Ethereum, promising speed and decentralization on the rare occasions where Plasma and Optimism do not do the same. Can Ethereum then survive with cheap L2s? Both EIP-4844 and Pectra bring down L2 costs, but really the challenge is for ETH to capture a slice of the value. L1 revenues have taken a hit since Dencun has gone live, reinforcing the fact that scaling proposals really need to go hand in hand with ETH monetary model reforms. Are L2s just conveyors for distribution, or can Ethereum actually leverage its revenue-channeling capability on par with how well it is able to scale L2s? In an L2-dominated world, will Ethereum be able to keep itself financially prosperous?
* Q: What are the main risks to Ethereum’s current price momentum? *
The path for Ethereum is full of challenges: Will regulatory storms around ETF staking and compliance in general be the final nail in its coffin? Are layer-1 revenues dwindling, removing the financial backing from its validators? And will layer-2 be able to burn enough ETH to actually sustain growth, or will it just drain value? A diminishing security budget at the base layer will cripple participation from validators as well as decentralization, the two strongest pillars holding Ethereum together. A proven way for Ethereum to make money off the layer-2 explosion must be found, or it will face the very real danger of slowing down, even with mass adoption. The stakes could not be higher.
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