The price of Ethereum (ETH) has been in a consolidation phase in recent weeks as investors wait for the next post-merge catalyst. The current ETH price is at $1,369, down slightly from the September 27th high of $1,403.
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The current ETH price is still about 35% below its peak in August this year
Ethereum is the largest smart contract platform in the world. Over the past decade, it has become the most useful network for building decentralized projects in areas such as DeFi and non-fungible tokens (NFT). The theory is that ETH does well when there are more developers and activities on its network.
However, a closer look at Ethereum’s ecosystem shows that there are some challenges. For example, activity in the DeFi ecosystem has been in freefall in recent months. The ecosystem’s total value of deposits (total value locked) peaked at more than $108 billion in December 2021, DeFi Llama data shows.
Currently, that value stands at about $31.7 billion. Maker, the largest DeFi platform in its ecosystem, has a total value of more than $7.7 billion. Other notable platforms include Lido, Curve, Uniswap, Aave, and Convex Finance.
The number of DeFi platforms has peaked. The ones that will flourish are the giants like Aave, Uniswap, Compound, and Maker.
Meanwhile, Ethereum has also established itself as the most important player in the NFT industry. Some of the most popular NFT projects in Ethereum are Bored Ape Yacht Club, CloneX, Sorare, and CryptoPunks.
Unfortunately, the NFT industry is not doing well. Ethereum NFT sales rose to an all-time high of over $3.99 billion in January. In September, volumes dropped to about $320 million.
What does all this mean for the Ethereum price? Historically, there has been a disconnect between the ETH price and the performance of NFT marketplaces and DeFi platforms.
Ethereum Price Forecast
On the price chart, it can be seen that the ETH price was in a consolidation phase in the last few days. During this period, it failed to move above the important resistance at $1,403. The price is also consolidating along the moving averages of the last 25 and 50 days, while the Relative Strength Index (RSI) has declined.
Therefore, there are two possible scenarios based on historical values. First, as seen in November 2018, there could be a major crash in the coming months. On the other hand, Ether could experience a new rally, as seen in March 2019.
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First published in CRYPTO MONDAY, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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