It has been reported that Ether, the token currency of Ethereum, has the chance to multiple its market valuation in the next few months. This would be the direct result of a coalition between fundamental indicators and a supportive technical method of operation.
The price of Ether did manage to rise by around 9% on the 1st of October where it went to touch $3,300 for the first time in over 10 days. The gains experienced by this cryptocurrency did surface mainly in the wake of a rebound in its prices across major cryptocurrencies, which includes Bitcoin.
Ethereum-Bitcoin correlation against rising U.S. inflation
The crypto market boom that took place on the 1st of October did coincide with the release of the report from the United States Department of Commerce. The data, which primarily highlighted consumer spending, also displayed that the core personal consumption expenditures price index for the country increased by 0.3% in August, and had an annual increase of 3.6% every year.
Quite a few analysts have therefore decided to treat Bitcoin as a hedge against this increasing inflation- which does explain the latest response of this cryptocurrency. At the same time, the 30-day average correlation of Ethereum with Bitcoin does sit near 0.89, as per data prescribed from CryptoWatch.
Ethereum also went through an immense network hard fork upgrade on the 5th of August that also raised the bullish outlook for its token currency- which owed directly to the law of demand and supply.
It has also been reported that Ethereum is currently preparing to switch its mechanism from a proof of work system to a proof of stake system. As a result of this, it has gone ahead and launched a staking pool that will allow its users to earn and grow rewards along with their ETH holdings if they manage to lock 32 ETH into the official smart contract for a certain amount of time.