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Ethereum Price Preview: September 28 – October 4


Welcome to the Ethereum Price Preview, an analysis of current and upcoming market events and how they might shape the price of ETH and the trajectory of the network.

Last week saw strong fundamentals and rising network activity pointing to a healthy network. 

In this piece, we take a look at the various factors that may be impacting Ethereum price for the week ahead.

Bitcoin on the Ethereum Network doubles to $1.2 billion

The amount of Bitcoin now represented as an asset on Ethereum has doubled in the last month to a record $1.2 billion. Over 114,000 bitcoins have been converted to Ethereum assets, allowing Bitcoin holders to stake Bitcoin in various DeFi protocols and Ethereum dApps. 0.5% of Bitcoin’s total market cap is now on the Ethereum blockchain, with Wrapped Bitcoin being the dominant synthetic asset.

Exchange Hacked for $200 Million

Singapore exchange KuCoin suffered a security breach and was taken for $200 million worth of cryptocurrencies and ERC-20 tokens last week. KuCoin released a statement saying that the stolen funds will be fully covered by their insurance policy. Multiple projects have taken action against the security breach by freezing funds, performing token swaps, and even implementing hard forks.

While major hacks can often affect price action, ETH price has remained relatively stable around the $350 range since the hack.

The hacker’s Ethereum addresses have been closely monitored since the theft and over the last few days, spectators have watched (in real-time) as the stolen funds were dumped on the market.

In other news, FX Street analysts made a case for a firm resistance point at $360 for the near-term, citing a bearish MACD that may be a response to inflated gas costs. The UniLog onboarding solution based on the Ethereum network shut down last Monday due to the increased gas costs, which have risen 20x over the last year.

On the other hand, network difficulty has reached the highest point since March 2019, and the hashrate has kept pace, indicating that miners see an incentive in supporting the network. This points to a healthy network where the miners believe in ETH profitability, with little sign of miners going under or switching to other networks.

DeFi Boom Continues With $11 Billion in TVL

Interest in DeFi saw billions of dollars enter the ecosystem over the last month. Total value locked in Defi is now over $11.2 billion according to DeFi Pulse, with $2 billion now locked in Uniswap alone. And Mask Network recently launched a feature that allows users to trade on Uniswap directly from Twitter, helping to further adoption in DeFi and crypto in general.

Uniswap is followed closely by Maker on the DeFi Pulse TVL leaderboard, with the Maker lending protocol continuing to grow in popularity throughout the recent price dip alongside other DeFi protocols. Of course, not all DeFi protocols rely on a healthy Ethereum ecosystem. $180 million is currently staked on the Ontology DeFi protocol which is not based on the Ethereum network. The protocol is arguably being spurred on by Ethereum congestion and the resulting high fees and gas costs.

Media Roundup

Block Live Asia 2020 is hosting an event called The Defi Uprising on Monday September 28. The online event aims to educate attendants on the nature and potential of DeFi, including an introduction to DeFi various projects and their tokenomics. The event will feature a panel on DEXs with representatives from Balancer, Bancor, and Curve. There are also panels focusing on the DeFi disruption of traditional finance, as well as DeFi in Cardano.

Ethereum Developer Alliance is hosting an event on September 29 called Introducing ConsenSys Quorum, with 35 attendants scheduled. The event will focus on discussion around ConsenSys’ acquisition of Quorum from JP Morgan and related projects and plans.

Token Engineering Switzerland is hosting an event on September 30 called Stable Coins Demystified: The Why, How, and Where. This will be a major event with representatives from Maker Foundation, Swiss Crypto Tokens AG, Swiss National Bank, Basel University, Globcoin, and more.

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Conor Maloney
Conor Maloney Analyst