While Ethereum's price may be trailing behind Bitcoin, Vitalik Buterin's recent response to Cardano's founder criticisms could pave the way for significant long-term appreciation.
Despite impressive 12% weekly gains, Ethereum dropped 2.9% this week to settle at $1,800, while Bitcoin continued its ascent. This divergence reflects an active short-term capital rotation in the cryptocurrency market as traders capitalize on macroeconomic conditions’ volatility.
In response to criticisms from Cardano’s founder, Charles Hoskinson, who predicted Ethereum’s collapse, Vitalik Buterin proposed an ambitious network update. The Ethereum co-founder shared details of a new Layer-Zero framework, utilizing advanced standards like zkVM and RISC-V, to address the scalability challenges facing the network.
According to shared documentation, this update could significantly increase Ethereum’s capacity, with up to 832 times fewer cycles than current EVM interpreters, a 95.7% reduction in proof cycles, and a 30x throughput increase through GPU acceleration. Additionally, proof compression through recursion could reduce the size from 346 MB to just 1.5 MB.
If successfully implemented, Vitalik’s Layer-Zero framework could reshape Ethereum’s scalability narrative, thus alleviating long-term concerns about ecosystem fragmentation.
A shift towards a high-efficiency infrastructure based on zkVM could indeed enhance Ethereum’s competitiveness against new chains while directly reducing fees on Layer-1 base layer.
Technically, Ethereum’s price is approaching its Ichimoku cloud on a daily basis and staying above the Kijun. Furthermore, it continues to hold above its 50-day moving average at $1794. The next resistances are at $1943 and $2300 (100-day moving average).
The bullish projection is supported by technical indicators such as Parabolic SAR and Fisher Transform, indicating a favorable trend reversal for buyers.
While short-term fluctuations may occur, the medium-term momentum clearly favours the bulls, particularly due to Vitalik Buterin’s proposal, which could give Ethereum a long-term boost.
In summary, despite short-term setbacks compared to Bitcoin, Ethereum’s price retains strong long-term growth potential. Vitalik Buterin’s response to Cardano’s founder criticisms, through his ambitious Layer-Zero update, could be the necessary catalyst to propel Ethereum to new highs.
Charles Ledoux is a Bitcoin and blockchain technology specialist. A graduate of the Crypto Academy, he has been a Bitcoin miner for over a year. He has written numerous masterclasses to educate newcomers to the industry and has authored over 2,000 articles on cryptocurrency. Now, he aims to share his passion for crypto through his articles for InvestX.
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