Disclaimer: The information presented does not constitute financial, investment, business or other advice and represents the opinion of the author only.
The last seven days have witnessed significant developments amid the ongoing uptrend.
On November 15, the spot from the asset management giant Blackrock Ethereum (ETH) Official Exchange Traded Fund (ETF) Application made his way at the office of the United States Securities and Exchange Commission (SEC).
The same day, the SEC notified that it had delayed its decision to approve the rule change requested by Grayscale Investments to convert its Ethereum fund into the Ether Futures ETF. The SEC now has until January 1, 2024 to make a decision. It was in September that the asset manager had filed for the change.
The anticipation around ETFs has certainly led to a sharp rise in prices on the charts. This, however, has led many to question the extent to which such developments could harm the decentralized model of blockchain technology underlying the crypto market. This is the reason why AMBCrypto also looked at the future of Ethereum..
How it started and then split
Child of Vitalik Buterin, the Ethereum blockchain network was first explored in a white paper in 2014. His colleagues on the project included Gavin Wood, Charles Hoskinson, Anthony Di Iorio and Joseph Lubin.
Subsequently, the team founded a Swiss non-profit foundation, the Ethereum Foundation (Ethereum Foundation). The project was launched in 2015.
Ethereum was created with the goal of being scalable, programmable, secure and decentralized. It natively supports smart contracts, a key element of decentralized applications. Smart contracts, combined with blockchain technology, enable a large number of decentralized finance (DeFi) applications.
Users can also generate and trade non-fungible tokens (NFTs), which are tokens that can be linked to specific digital assets such as photos. Additionally, several other cryptocurrencies use the ERC-20 token standard in addition to the Ethereum blockchain and have used it for initial coin offerings.
Just one year after its launch, the project split into Ethereum and Ethereum Classic (ETC).
What happened was that in 2016, a group of network participants took majority control of the Ethereum blockchain in order to steal ether worth over $50 million that had was collected for a project. Most of the Ethereum community chose to undo the theft by invalidating the existing Ethereum blockchain and endorsing a blockchain with a revised history: Ethereum.
However, a fraction of the community chose to keep the original version of the Ethereum blockchain. The unchanged version of the blockchain has definitively split to become Ethereum Classic.
The event became known as Hard fork.
The merger and the Shappella
Ethereum initially used the Proof of Work (PoW) consensus mechanism. Validating blocks required an energy-intensive calculation called mining.
Due to criticism regarding the environmental impact of the mechanism, the project moved to the Proof of Stake (PoS) consensus mechanism in September 2022. The event became known as Merge.
It is essential at this point that we understand what these two mechanisms are and how they differ.
A consensus mechanism includes the rules and protocols that govern how a blockchain network reaches agreement on its state. The two most popular mechanisms are PoW and PoS.
PoW requires the use of computing power by miners to solve difficult mathematical puzzles and validate transactions. The first miner to solve the challenge receives new coins and transaction fees. Although it seems more secure and decentralized, it also consumes a significant amount of energy and resources.
Instead of requiring miners to resolve issues, PoS requires validators to stake some of their coins as collateral. The network then chooses a validator at random to construct a new block based on stake size and other parameters. The validator is paid by transaction fees rather than new currencies.
PoS is considered more scalable and energy efficient than PoW.
At press time, a total of 28,195,445 ETH tokens were stakedvalued at $55.6 billion.
ETH is the second largest cryptocurrency in the world, with a market capitalization over $233 billion.
A recent CoinGecko Report place Ethereum as the top layer 1 (L1) blockchain. Its total value locked (TVL) stood at $23.0 billion as of October 2023.
In 2023, it reached its annual TVL peak of $31.5 billion in April. This was shortly after the merger.
At this point, we decided it was a good time to reach out to ChatGPT, the pioneering AI bot, for critical advice on these developments.
ChatGPT has proven valuable for traders and analysts. I spoke to ChatGPT about these developments while also touching a little on the price of ETH.
At first, ChatGPT was unable to provide any details. So I decided to educate him and jailbreak him.
We then asked him about the impact of the merger on the price of Ethereum.
The robot told me that the merger had catalyzed an increase in demand and confidence. Its response does not deviate from real-time data.
In April 2023, the Ethereum hard fork in Shanghai, also called Shapell, has been finalized. The upgrade allowed users to unlock their ETH tokens for the first time since December 2020.
Notably, the Shappella is a combination of the Shanghai and Capella upgrade. The Shanghai upgrade takes place at the execution level, while Capella takes place at the consensus level.
This upgrade marks the second-largest blockchain’s most significant development since the merger.
Is Ethereum a commodity or a security?
As with most cryptocurrencies, there has been much debate over whether Ethereum is a commodity or a security.
In a critical court case against Uniswap, Judge governed in August, ETH is a commodity. The SEC has been reluctant to do so even though it has not gone after ether like other tokens.
Recently, Bloomberg analyst James Seyffart highlighted the SEC’s unspoken position on this issue.
Although the SEC will not explicitly claim that ETH is a commodity like it does Bitcoin. They have implicitly accepted its commodity status for years. A huge congratulations to @SGJohnsson who played a critical role in forming some of my opinions on this topic. https://t.co/vLq2abeJNO
–James Seyffart (@JSeyff) November 16, 2023
However, we should also take note of any non-explicit classifications so far. The position of regulators has also evolved over the years, with courts intervening on numerous occasions.
I asked ChatGPT about the future performance of Ethereum
Ethereum has slowly become one of the most important blockchain networks. As expected, it supports a large number of L2 blockchains. The TVL of Ethereum-based L2 networks recently reached an all-time high, surpassing $13.8 billion.
📈 The total value locked (TVL) in all #Ethereum Layer 2 networks hit an all-time high, surpassing $13.8 billion.
– GN Crypto 🇺🇦 (@GNcrypto_news) November 16, 2023
Thanks to the recent bull run, ETH has been trading around the $2,000 mark for the past few days. At press time, ETH was trading at $1,986.50.
While Ethereum’s Relative Strength Index (RSI) remained below the neutral mark of 50, its The money flow index (MFI) is above. It appears that bears and bulls are engaged in a tug-of-war over ETH..
We then asked ChatGPT to predict the price of Ethereum towards the end of Q1 2024.
He predicted the price of ETH would reach $7,000 by the end of Q1 2024. Essentially, he expected ETH to rise more than 3x over the next five months – an expectation extraordinary, to be frank.
Next, we asked him what he thought about the price of ETH by the end of next year.
The robot told me that it predicted ETH would reach $10,000 by the end of 2024. It expected the cryptocurrency to grow 5x over the next year.
Although this is a very high expectation, we should not dismiss it out of hand. We are yet to see the broader implications of ETFs in the crypto market. It is quite possible that this will lead to wider adoption, causing token prices to rise.
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After meeting ChatGPT, I have to admit that it may be a good idea to exploit its capabilities. As technology evolves, so does its potential to revolutionize the cryptocurrency ecosystem.
Additionally, the network growth of several crypto projects has seen a slowdown recently. But with ChatGPT available, crypto education and adoption could improve.
More importantly, you might want to take his “classic” answer a little seriously.
When it comes to Ethereum price analysis and prediction, ChatGPT has proven to be a reliable ally. You just need to interact with him enough and he will guide you to the moon.
While ChatGPT predicts that ETH will reach the price of $10,000 by the end of 2024, its chart metrics do not suggest a bull run.