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Ethereum Price Preview: June 22 – June 28


Welcome to the Ethereum Price weekly preview where we examine some of the significant events that are unfolding this week as well as the broader direction in which ETH is moving. Each week we look at upcoming market activity, emerging trends and industry events to provide an overview of the major Ethereum talking points that lie ahead.

Ethereum Gas at All-Time High

Ethereum gas spiked to hit an enormous all-time-high at the end of last week, with more activity on the network than ever before.

Source: Glassnode

Gas is a unit that measures computational power on the Ethereum blockchain, and the record high of 73.83 billion units of gas seen on June 21st indicates increased network activity. Gas usage itself is not necessarily a bullish indicator, as Ethereum is often congested by frivolous projects that generate many small transactions throughout their lifecycle.

Daily transactions border on crossing 1,000,000. A level not seen since June 2019.

However, the surge and persistence of activity has prompted action among the mining community. Blockchain analytics firm Bitfly announced on Friday June 19 that the miners were voting to increase the gas limit, the amount of gas that can be expended on one block of transactions.

This amounts to expanding the processing power of the network, and Bitfly anticipates that the block limit increase will aid scaling and transaction speeds:

A 25% increase in transactions per second would mark a major improvement in the network’s performance, and possibly create bullish sentiment around Ethereum.

It’s worth noting that the vote is controversial. Some developers and community members concerned that the gas limit increase could lead to centralization. Core developer Péter Szilágyi criticized the decision, citing potential DoS attacks as a potential outcome.

DeFi Fundamentals Starting to Improve

DeFi has once again crossed the $1 billion threshold, garnering more publicity for Ethereum. 

Headline stats on the total value locked (TVL) of the DeFi industry can be misleading – while TVL has skyrocketed recently, much of this value has been added in DAI, BTC, and other assets. Ethereum TVL has trended downward since the March 2020 flash crash, but has seen a sharp spike over the last week, another potentially bullish signal.

Source: DeFi Pulse

Major Options Expiry May Signal Volatility Ahead

The Deribit derivatives platform highlighted that a record number of BTC and ETH options are due to expire on June 26, valued at over $1 billion. 

Options traders reserve the option to buy assets at a fixed price in the future, and an options contract remains valid until it expires. 290,000 Ethereum options will expire this week, along with 70,000 BTC options which account for 69% of the total value, or open interest (OI).

Many traders often exit their positions at or near expiry dates, and such a mass expiry of contracts could lead to significantly increased volatility in the market.

Media Round-up

Ethereum was mentioned on Twitter over 8,000 times on June 17, reaching a level not seen since August 2019. Google trends, on the other hand, shows a mild downtrend in popularity for the search term “Ethereum” throughout June.

This may be set to change, as all eyes are now on the upcoming Ethereum 2.0 launch. The launch is a keenly awaited update to the network aimed to tackle scaling and help Ethereum fulfil its purpose as a “world computer” for many different decentralized applications.

Finally, there are a number of scheduled events and conferences taking place over the week. Remote Crypto Con features prominent speakers such as MyCrypto CEO and MyEtherWallet founder Taylor Monahan. The online Atato conference features Consensys Head of R&D Robert Drost for talks on Ethereum 2.0, and the online Ethereum Buenos Aires and Ethereum Chicago meetups will be held online featuring members from both communities.

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Conor Maloney
Conor Maloney Analyst