Ethereum’s protocol upgrades and rising institutional interest are shaping its future. How could this affect its price?
- ETH is seeing increased institutional adoption. ETH is facing reduced buying activity at the moment.
Ethereum [ETH] is on the brink of transformative developments, fueled by ongoing protocol improvements and a surge in adoption from major financial institutions.
Recently, another trillion-dollar bank announced plans to launch tokenized treasuries on the network, adding further legitimacy and potential demand for its ecosystem. These factors prompt a key question: how might these advancements influence Ethereum’s price trajectory?
Plans for Ethereum’s scalability and longevity
One of the most ambitious moves on Ethereum’s roadmap is The Purge, an initiative designed to streamline the network by reducing the storage and computational demands on node operators.
Vitalik Buterin has highlighted the importance of this step as Ethereum’s data footprint continues to grow. Without this change, fewer individuals or organizations may be able to maintain full nodes, risking centralization.
The Purge aims to tackle these challenges by introducing history and state expiry mechanisms, allowing nodes to function without storing extensive historical data.
This approach is expected to lower operational costs for node operators, potentially making it more attractive to institutional participants.
However, the impact on ETH’s price might take time; it largely depends on how quickly the benefits of this upgrade become evident and adopted across the network.
Ethereum’s institutional adoption could boost Demand
A major bank recently announced plans to launch tokenized treasuries on the Ethereum network in a move signaling Ethereum’s appeal to large financial players.
Tokenized treasuries offer faster, secure transactions and represent a multi-billion-dollar use case, underlining ETH’s role as a leading platform for digital assets.
This trend of financial institutions turning to Ethereum could drive significant demand for ETH, as transactions on the network require ETH to process and secure them.
Furthermore, Ethereum’s price could see upward pressure if this institutional momentum persists, particularly if more banks and financial entities choose the network for tokenized assets.
Such adoption enhances confidence in Ethereum’s long-term utility, potentially strengthening ETH’s position in the market.
ETH: Near-term and long-term outlook
From a technical standpoint, Ethereum’s price shows signs of consolidation with potential upward movement. Trading near $2,498, it sits just below its 50-day moving average, indicating slight bearish sentiment in the short term.
The Chaikin Money Flow (CMF) shows a minor capital outflow, while the RSI hovers around 46, signaling limited buying activity.
Source: TradingView
However, should institutional adoption grow and the advantages of The Purge become more apparent, ETH could break through $3,000. A break could propel ETH to further price increases.
Read Ethereum (ETH) Price Prediction 2024-25
Alternatively, if institutional interest falters or delays in The Purge’s implementation occur, ETH could test support levels around $2,200. This level is a critical support marker; falling below it could lead to deeper declines.
Additionally, in the long run, Ethereum’s growing infrastructure and institutional appeal present a bullish case. As these developments mature, potential price targets may extend into the $3,500–$4,000 range.
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