After a brutal few months for the price of Ethereum’s native token, Ether (ETH) has gone on a run. ETH is up over 41% in the last seven days, and is currently trading at around $1,555, according to CoinGecko. The token has climbed as high as $1,610 in the last 24-hours. This upward movement is the result of two “certainties,” Youwei Yang, financial analytics director at StoneX, tells Fortune: The first is the recently-confirmed date of the Ethereum “merge” upgrade, which promises to transform the network to a more efficient system that uses far less energy. The second, Yang says, is the “calming” of macroeconomic fears. “Actually if you see the price movement tick by tick, this time it’s more like ETH leading BTC [or Bitcoin] instead of the other way around in usual times so it’s a strong indication of ETH-led bear market rally with the confirmation and sentiment of ETH2.0,” said Yang, referring to post-merge Ethereum. The merge will shift Ethereum’s so-called consensus mechanism from proof of work to proof of stake. The former involves miners expending large amounts of computer power to complete complex puzzles to validate transactions. Proof of stake, by contrast, is a validation system that relies on a network of participants who are willing to pledge—or “stake”—a portion of Ether tokens. By moving to this new model, Ethereum’s environmental impact will likely decrease dramatically.
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