Tips for traders, 20 April 2021
With the Berlin hard fork, Ether finally recorded another all-time high last Thursday (15/4). Ether briefly sat at $2,565 on Binance. This hard fork will not be compatible with the old Ethereum clients (for miners), one of the journeys for Ethereum 2.0 which will change its Proof-of-Work algorithm to Proof-of-Stake. The hard fork implemented some Ethereum improvement proposals:
- EIP-2565, which reduces the gas cost for a specific type of transaction that uses modular exponentiation
- EIP-2718, which makes all types of transaction backward compatible using “envelope transactions,” allowing the addition of new logic into Ethereum.
- EIP-2929, which increases gas costs for “op code” transactions, a pain point for denial of service attacks on Ethereum in the past.
- EIP-2930, a new type made possible by EIP-2718’s envelope transactions which allows users to create templates for future, complex transactions to lower gas costs.
These improvements might sound very complicated, but in short they will reduce costs of transactions substantially while increasing costs for attackers trying to jam the network with unnecessary transactions.
Technically speaking, after its all-time high around $2,565, Ether had a hard throwback on Monday when it dropped below $2,000. This was caused by bitcoin’s drop that made people panic and sell while institutions and whales accumulated even with outflow transactions shown in on-chain data.
On Sunday Ether went back above $2,100, followed by a retest on Monday (19/4). Currently, Ether is still retesting that level. If it holds, we might expect Ether to go further north. For now, it is safer to trade over the shorter term while waiting for a daily confirmation on longer term buying.