On-chain activity within Ethereum layer-2 protocols and ETH derivatives data suggests that the altcoin will hold the $3,200 level.
Ether (ETH) price faced a significant setback after encountering robust resistance at the $4,100 mark on March 12. Ether has seen a 9% decline over the past week, underperforming when compared to the broader cryptocurrency market, leading traders to speculate whether the current support level of $3,200 will hold. For context, the total cryptocurrency market capitalization fell by 2.5% during the same timeframe.
From a bullish viewpoint, the potential approval of a spot Ethereum exchange-traded fund (ETF) remains a key catalyst. The United States Securities and Exchange Commission (SEC) is currently reviewing the matter, with a final decision anticipated by May 23. However, Bloomberg senior ETF analyst James Seyffart does not consider approval as his base scenario.
The recent upgrades to the Ethereum protocol should not be overlooked. The Dencun hard fork, which took place on March 13, aimed at enhancing the network's scalability and improving layer-2 data processing capabilities, is highly sought after by rollup solutions. As a result, transaction fees for most applications on Arbitrum, Optimism, and Base have significantly decreased.
