Ethereum is also at the forefront of major transformations in the cryptocurrency space due to advancements in technology. Ethereum’s price has been on a roller coaster ride over the past month, reaching an all-time high in November before falling to a major catastrophe now. At the time of this writing, ETH was trading for US$4,180 with a market capitalization of US$495.34 billion. The cryptocurrency fell by 10.14% on Saturday, the largest percentage drop in a day since November 26, 2021. In 2022, we explore the possibility of Ethereum making a comeback when conditions seem very unstable.
Ethereum is a blockchain that can be used to design all kinds of applications. As non-fungible tokens (NFTs) and decentralized finance (DeFi) have grown in popularity over the past year, scalability has gained momentum. Fortunately, futuristic and advanced blockchain models like Ethereum are seen as the only remedy.
ETH was developed as a marketplace for buying and selling cryptocurrencies. However, as technology evolved, the platform introduced advancements that could lower the transaction fee and speed up the process. Although all these developments are inevitable, the Ethereum price is still downward and worries investors.
The digital token recently reached an all-time high of US$4,864.06 on November 10, 2021. Everyone was surprised because ETH usually follows the trend of Bitcoin. While Bitcin price was following a moderate value, the Etherem price made a record. However, Ethereum’s price surge didn’t last for a longer time. However, the cryptocurrency is back to its moderate state. This article looks at the possibilities of ETH making it big in 2022 and beyond.
Ethereum Layer 2 Network
Ethereum was originally designed to slow down and become more expensive as its popularity grew. However, ETH has come up with a Layer 2 project that could help blockchain technology stay strong. If the update gains momentum, Ethereum might only be used for very large transactions in the future, with massive transactions happening on the Layer 2 network.
The transition will be led by Layer 2 solutions, including Arbitrum, Loopring, Optimism, and StartkWave. According to the tracker L2Berat, Layer 2 is now locked with US$7 billion worth of transactions versus US$48 million at the beginning of the year. However, further advancements are already being made so that ETH may gain traction in 2022.
Ethereum’s Stronghold in the NFT Market
Recently, Metaverse ecosystem and play-to-earn gaming facilities are gaining traction among people. Not just crypto investors, even non-investors are trying their hand on the new model. Ronin-based NFT game Axie Infinity has already generated millions of dollars in annualized revenue, thanks to blockchain development. As the gap between finance and gaming narrows, the Ethereum platform has the chance to make it a win.
On the other hand, we have Airdrops and equity distribution that have distributed wealth much more freely and fairly than ever before. If Ethereum manages to break all grounds in the coming months, 2022 will be a great year for the cryptocurrency. It can even manage to overturn Bitcoin with its potential.
Ethereum’s Support to dApps
Although Ethereum outperforms Bitcoin on many fronts, its major key is the underlying blockchain that allows developers to create decentralized applications (dApps). While Bitcoin was created in 2009, its blockchain was created to support public ledger cryptography. Unfortunately, BTC was unable to engage in many updates over the years. Today, Ethereum is driving the change as it creates new concepts to improve the dApps ecosystem. Beyond NFTs and decentralized applications, Ethereum’s concept is expanding into the tokenization of physical items including real estate.
Ethereum in 2022
Similar to Bitcoin, Etheruem is also all set to gain institutional investors in 2022. Ethereum price has gained over 500% growth in 2021, which is higher than that of Bitcoin. Besides, the introduction of ‘Ethereum Burn’ option has also given an edge to the cryptocurrency against its long-time competitor, Bitcoin. According to predictions, Ethereum price will breach its long-term resistance of US$5,000 in 2022. If other things go well, it can even touch US$10,000 and make a record rally in the coming year.