Can Ethereum (ETH) Reach 10k in 2022?
ETH is the second-largest cryptocurrency in terms of market value. With ETH up more than 440% since the start of 2021, investors see the network's potential. The Ethereum network, in particular, is not yet complete; additional features and enhancements are still in the works, giving this cryptocurrency a lot of potentials. Will ETH's meteoric rise continue? So, what does the Ethereum price forecast for 2022 look like? Is this a one-time blip? Is there a real chance that the coin will reclaim its previous highs or maybe reach as high as 10,000 by the year-end? Let’s take a look at the factors or what it will take for ETH to reach that milestone this year.
Ethereum’s Blockchain Upgrades For 2022
Throughout 2021, the Ethereum blockchain was upgraded to Ethereum 2.0, a project that will continue into 2022. Coin burning was introduced as part of the London hard fork, or split, in August, and is meant to increase the value of the ETH coin by limiting supply as its use grows. On October 27, the Altair upgrade went live on the main network. The Ethereum Beacon Chain upgrade is a test of the transition to proof-of-stake (PoS) block mining. To complete the Ethereum 2.0 upgrade, the main Ethereum chain will combine with the Beacon Chain in 2022.
As the blockchain transitions from proof-of-work (PoW) mining to proof-of-stake (PoS) mining, the Arrow Glacier network update took effect on December 8, delaying the "difficulty bomb," or an increase in mining difficulty, until June 2022. According to the Ethereum Cat Herders development blog, "the Ethereum clients' team wished to avoid having to organize another pushback while working on the next large upgrade."
Institutional Interests in ETH
Large growth in Ethereum blockchain use might push its token to $10,000 or higher. Ethereum has already established itself as the most popular blockchain for smart contracts. It's not difficult to imagine the impending improvement drawing a large number of developers in the future year. Institutional investors have expressed interest in Ethereum this year, owing to the introduction of applications like decentralized finance (DeFi) and non-fungible tokens (NFTs).
According to CoinShares, Ethereum outflows totaled $39.2 million in the first week of 2022. JP Morgan is one of the organizations delving deeper into the bitcoin field. At its Crypto Economy Forum event, it gave free NFTs minted on the Ethereum-based Polygon network, which has since been listed on the OpenSea NFT marketplace. To promote its support of the Sibos conference, Bank of America just launched its first NFT.
Bad news for one or more of Ethereum's main competitors could potentially help in this regard. A major security breach or prolonged unavailability for Cardano or Solana, for example, could entice developers to transfer to Ethereum.
Several projects are now competing with Ethereum, including Solana, Algorand, Polkadot, and Cardano. These technologies, while promising and now more scalable than Ethereum, are nonetheless lagging behind Ethereum in terms of growing the dApp ecosystem.
What Can Stop it From Happening?
Numerous obstacles could prevent Ethereum's price from going above $10,000 next year. For one thing, the whole cryptocurrency environment must remain stable. Ethereum would very probably be dragged down by a broader sell-off.
The Ethereum 2.0 upgrade's shard chain phase has already been pushed out from 2022 to 2023. Any further large delays in the upgrade could prevent Ethereum from considerably increasing in value in 2022. Even if the update isn't postponed, Ethereum may lose ground to competing blockchains. Smart contracts are supported by other blockchains as well, but with far faster transaction rates and reduced gas fees.
Here’s What The History Says
In all but two years since its introduction in 2015, Ethereum has achieved gains of more than 160%. From a historical perspective, this may appear to indicate that the cryptocurrency's chances of reaching the target level are quite good. However, the larger a cryptocurrency becomes, the more difficult it is to grow at the same rate.
However, the components are in place for Ethereum to have another successful year. As new apps are built on the blockchain, billionaire Mark Cuban expects that it will be a huge winner in 2022. He may be correct. Even if he isn't, Ethereum might provide investors with significant long-term profits.
The Bottom Line
The prospects for Ethereum in 2022 are bright. Given that ETH increased by more than 430% in 2021, a 230% growth to $10,000 next year is an easy conclusion. Furthermore, assuming Ethereum maintains its current trend, the price of the cryptocurrency might reach $20,000 by 2022.
While the cryptocurrency sector is expected to grow next year, volatility is expected to stay high. As a result, in 2022, the Ethereum price may undergo multiple significant drops. However, if the cryptocurrency industry continues to grow, the Ethereum price might hit $10,000 in 2022, according to our estimates.