As global cryptocurrency markets lost 1.5% of their market capitalization last night, several relevant altcoins also plummeted. However, the market movement did not erase the recent gains of cryptocurrencies such as Solana (SOL), Terra (LUNA) and Algorand (ALGO).
Solana has risen 27.56% since last week and its holders are still enjoying around 7% appreciation, at the time of writing, after the nightly move, as it trades near $190 this Saturday afternoon. (11) — Last month, Solana was worth US$ 39.
Today’s performance is nothing new for Solana. Last month, Ethereum’s competitor was not even in the top ten cryptocurrencies by market capitalization. Earlier this month, SOL took a trip to Dogecoin and reached the seventh position in the market. Last Tuesday, it conquered the top 6 by surpassing the market value of XRP.
Solana isn’t the only currency in a network of smart contracts that has hit big price spikes. SOMETHING is up 4% today and about 75% higher than last week, trading around $2.10. In August, Algorand traded at USD 0.88, which means that the value of the currency tripled in this period.
On the 31st, Algorand announced that it had signed a cooperation agreement with Koibanx, a blockchain fintech in Latin America, to develop a blockchain infrastructure in El Salvador.
Altcoin Terra also weathered the market crash last night. It trades at $39 — 5% more than Friday, and approximately 21% more than last week.
Earth’s recovery may be being bolstered by the anticipation of network updates that were expected in the fourth quarter. José Maria Macedo, founding partner of Delphi Digital, a research firm, calls these projects ‘Autumn Land’.
The most notable update will be the rollout of the Columbus-5 core network this month. The Col-5’s launch was originally scheduled for Thursday, but the Terra team has announced that it will be delayed for about three weeks.
Col-5 integrates with Cosmos’ Inter Blockchain protocol to allow Terra to interact with other decentralized networks. Other advantages include simplified trading between stablecoins, burning and the ability of LUNA stakers to receive swap fees.
Meanwhile, the two leading cryptocurrencies, bitcoin and ethereum, have fallen significantly this week. Bitcoin dropped 9.3% and Ethereum 15.2%. Respectively, assets trade at the time of text at $45,920 and $3,335
EIP-4490, EIP-4488 can help lower transaction fees on Ethereum and more, but…
While most people might be busy with holiday shopping, Ethereum core developers are also seeing a packed schedule as the Merge nears. With updates to be announced and proposals to be discussed, Ethereum developer Tim Beiko shared a thread summarizing the events of the most recent All Core Devs meeting.
Do you ‘node’, what’s going on?
Naturally, the Merge was on everyone’s minds and Beiko reminded the community that the second and third devnets would be taking place the following week, with a last devnet on 14 December.
Next, Beiko admitted that fees were high not just on the Ethereum mainnet, but also when using rollups. He spoke about two solutions – EIP-4490 and EIP-4488. Both proposed reducing calldata costs to reduce transaction fees. However, participants were reportedly divided as to whether this should happen before or after the merge.
“Also, the amount of work here is fairly small: change a gas price, add a validity check and (hardest!) implement a new txn pool sorting algorithm.”
“If we do want to ship this before the merge, though, we need to act fast: the fork would have to hit mainnet in February at the latest, and we only have one more ACD [All Core Devs meet] before the end of this year!”
What’s more, Beiko suggested that client prototypes might come during the next two weeks.
Not just a case of “Ether” this or that
Beiko summarized some other problems that the developers discussed during the meet. One major challenge was to make Ethereum sustainable in the long term. For this, Beiko said there were conversations about EIP-4444, which is meant to deal with Ethereum’s historical data and the storage issues caused by the same.
Beiko also reminded users about the Arrow Glacier upgrade around 8 December, which would push back the difficulty bomb.
Running out of space
Notably, historical data from past blocks on the Ethereum chain are growing, and validators reportedly have been forced to use bigger and bigger hard disks. In a Reddit AMA, Vitalik Buterin admitted he faced the same problem. While introducing historical expiry, he said,
“…instead of all full nodes having to download and serve the full chain from genesis, and needing to have ever-increasing technical complexity to deal with both old and new versions, the core Ethereum protocol would only be responsible for holding and serving the most recent ~1 year of historical blocks, transactions and receipts/logs.”
Vitalik Buterin proposes calldata limit per block to lower ETH gas costs
Ethereum co-founder Vitalik Buterin has proposed a new limit on the total transaction calldata in a block to decrease the overall transaction calldata gas cost over the ETH network.
Buterin’s post on the Ethereum Magicians forum, EIP-4488, highlights concerns regarding high transaction fees on layer-one blockchains for rollups and the considerable amount of time to implement and deploy data sharding:
“Hence, a short-term solution to further cut costs for rollups and to incentivize an ecosystem-wide transition to a rollup-centric Ethereum is desired.”
While the entrepreneur cited an alternative wherein the gas costs parameters could be decreased without further adding a limit to the block size, he foresees a security concern in decreasing the calldata gas cost from 16 to 3:
“[This] would increase the maximum block size to 10M bytes and push the Ethereum p2p networking layer to unprecedented levels of strain and risk breaking the network.”
Some think layer 2 fees on ETH are too high, because each byte of data a rollup uses cost 16 gas. To lower fees, the gas cost could be reduced to 3. This should be a large benefit, with 5x lower fees. However, in the long term, this may mean blocksize is a new network constraint pic.twitter.com/ffbTQ4zXOz— BitMEX Research (@BitMEXResearch) November 26, 2021
Buterin issued a decrease-cost-and-cap proposal, which aims to achieve the goal of reducing unprecedented levels of strain and risk breaking the network, and believes that “1.5 MB will be sufficient while preventing most of the security risk.” As for advice to the Ethereum community, he wrote:
“It’s worth rethinking the historical opposition to multi-dimensional resource limits and considering them as a pragmatic way to simultaneously achieve moderate scalability gains while retaining security.”
If accepted, the implementation of the proposal will require a scheduled network upgrade, resulting in a backward-incompatible gas repricing for the Ethereum ecosystem. This upgrade will also mean that miners will have to comply with a new rule that prevents the addition of new transactions into a block when the total calldata size reaches the maximum. “A worst-case scenario would be a theoretical long-run maximum of ~1,262,861 bytes per 12 sec slot, or ~3.0 TB per year,” the proposal read.
However, the community is discussing other options like the implementation of a soft limit. Others raised concerns about the congestion during nonfungible token (NFT) sales, which may require users to compensate for the lack of execution gas by paying a higher total fee.
Rising gas fees have resulted in an outflow of users from the Ethereum network to lower the cost of Ethereum Virtual Machine-compatible networks.
As Cointelegraph reported on Nov. 4, Etherscan data shows that approving a token to be transacted on Uniswap decentralized finance protocol can cost as much as $50 worth in Ether (ETH).
Additionally, layer-two solutions, which were billed as the protocols that would help solve the fee issue, have been charging high fees due to network congestion amid the onboarding of new users.
Ethereum price could easily double as ETH long term outlook screams bullish
- Ethereum price has formed a chart pattern on the weekly chart that indicates an optimistic outlook of a 97% ascent.
- ETH must clear a few critical resistances before the bullish forecast could be validated.
- Holding above $3,917 is crucial for the token’s rise toward $10,000.
Ethereum price continues to consolidate and discover reliable support above $4,000. ETH appears to be preparing for a massive bull run, as a technical pattern suggests that the second-largest cryptocurrency by market capitalization is looking to double its value in the longer term.
Ethereum price eyes $10,000
Ethereum price has printed a bull pennant pattern on the weekly chart, suggesting that ETH is eyeing higher prices. The prevailing chart pattern suggests that if the token slices above the upper boundary at $5,252, a 97% ascent toward $10,418 is on the radar.
ETH/USDT weekly chart
The first area of resistance for Ethereum price appears to be at $4,211, where the 50-day Simple Moving Average (SMA) and the 78.6% Fibonacci retracement level coincide. Additional resistance will emerge at the 21-day SMA at $4,421.
The token’s all-time high at $4,884 will then act as an additional obstacle for Ethereum price, but slicing above this level could unravel further bullish intentions for ETH.
If Ethereum price manages to break above the aforementioned resistances, ETH may target the last remaining obstacle before the bullish outlook is validated, at the upper boundary of the bull pennant at $5,252. The 97% climb toward $10,418 would then be on the radar, but the token would be confronted by several hurdles, including the 127.2% Fibonacci retracement level at $5,762, then at the 161.8% Fibonacci retracement level at $6,866.
ETH/USDT daily chart
However, if Ethereum price faces profit-taking, ETH would discover the first line of defense at the September 3 high at $4,020, then at the October 16 high at $3,962. The lower boundary of the governing technical pattern at $3,917, coinciding with the support line given by the Momentum Reversal Indicator (MRI).
Investors should note that if Ethereum price slices below the aforementioned foothold, the bullish thesis may be invalidated and ETH could continue to slide lower, as it searches for reliable support at the 100-day SMA at $3,762, then at the 61.8% Fibonacci retracement level at $3,675.