Coins associated with young platforms for launching DeFi and NFT projects are expected to rise in November, but ETH is highly likely to demonstrate great growth as well.
Ethereum has renewed its all-time high at $4477.5. Since August, after the London upgrade, a powerful deflationary mechanism began to work on the Ethereum network with burning part of the fees. Burning tokens always increase the rate, and systematic work in this direction has an even more positive effect on the price of an asset. It is paradoxical that now the increase in network fees does not lead to a drop in ETH, but to an increase in its price since more coins are burned.
This situation may last until the full transition to ETH 2.0. For the second week, there has been a negative emission in the Ethereum network, the number of tokens burned exceeds the number of tokens issued. About 15K ETH is burned daily, according to the tracker Ultrasound.Money. Meanwhile, according to the WatchtheBurn service, the final emission is minus 8034 ETH. In total, 724.4K ETH has been burned since the London upgrade.
Rumors that the upgrade of the Ethereum network leads to an increase in fees have not been confirmed. Fees are growing due to the popularity of the platform and the launch of new DeFi and NFT projects on it. According to the report on network activity for the third quarter, the transactions for the July-September period amounted to $536.5 billion. This is 5 times more than in the same period last year.
Transactions through Layer Two solutions (L2) are also growing. L2 protocols were launched to scale the Ethereum network. Transactions on L2 networks are growing even faster than on the main network. In just two months, the volume increased by 500%, the total value locked (TVL) reached $4.68 billion.
Experts note that the growth of transactions in the Etherеum network occurs with a decrease in investment in bitcoin. Immediately after the launch of the bitcoin futures ETF, an additional $1.45 billion was invested in BTC in a week. A week later, the amount of investment decreased 5 times and amounted to $268 million, according to the investment firm CoinShares. The inflow of funds in ETH for the same week amounted to $16.6 million. This is much less, but it is important that in the previous three weeks there was an outflow from ETH. Experts note that the effect of the launch of the bitcoin futures ETF is less than expected.
The technical analysis of the ETH chart speaks in favor of continued growth, according to the popular analyst Pentoshi. Over the past week, ETH has updated its all-time high several times. Former resistance levels now become the support levels. Bouncing off them, ETH could rise another 25% -35%. The optimistic forecast is the price of $6100 by the end of the year.