{"id":22656,"date":"2022-08-18T16:43:22","date_gmt":"2022-08-18T11:13:22","guid":{"rendered":"https:\/\/coinswitch.co\/switch\/?p=22656"},"modified":"2024-06-06T16:43:17","modified_gmt":"2024-06-06T11:13:17","slug":"ethereum-upgrades-and-corresponding-price-actions","status":"publish","type":"post","link":"https:\/\/coinswitch.co\/switch\/crypto\/ethereum-upgrades-and-corresponding-price-actions\/","title":{"rendered":"Ethereum upgrades and corresponding price actions: Everything investors need to know"},"content":{"rendered":"

If you have any plans about buying or selling Ether, we urge you to hit pause until the end of this article. Because Ethereum is undergoing what is being touted as a historic upgrade\u2014called the Merge\u2014soon (hopefully on 15\/16 September 2022). This article is here to help you look into the past to understand how ETH prices have moved before and after significant ecosystem upgrades like the Merge<\/a>.<\/p>\n

We hope that the lessons you take away will help you plan or reassess your next move.<\/p>\n

Why discussing Ethereum makes sense<\/h2>\n

The Merge is expected to be a watershed moment in the history of crypto. With the Proof-of-Work blockchain transforming into a Proof-of-Stake one, Ethereum\u2019s future looks promising.<\/p>\n

But wait, isn\u2019t Ethereum still down by 67% from its all-time high of $4,891.70?<\/p>\n

It is. Because inflation, talk of a recession, and interest rate hikes have battered the crypto market, and ETH has had to bear a lot of the brunt.<\/p>\n

But the dip hasn\u2019t made the Merge less desirable, and there seems to be little reason to worry. Why do we think that? Because every time there has been an upgrade, the prices have moved a fair bit. And with the merger, price movements like the current one aren\u2019t unexpected.<\/p>\n

Tracking Ethereum\u2019s price moves<\/h2>\n

Back in 2015, ETH was at its lowest, $0.42. Six years later, in November 2021, it\u2019s at $4,900\u2014registering over 11,00,000% gains over that time. A mind-blowing number, right?<\/p>\n

However, price movements haven\u2019t followed a linear path during these six years. While investors were always very excited about ETH, drastic price moves were recorded every time there was an upgrade for Ethereum.<\/p>\n

Upgrade 1: The DAO Fork<\/h3>\n

The details<\/p>\n

In July 2016, a standard smart contract hack became the reason for what is now known as the DAO upgrade (hard fork). Almost 85% of the voters believed that a change in protocol was necessary to make Ethereum more secure. This fork is why we have two Ethereum ecosystems now: Ethereum Classic (the old one) and Ethereum.<\/p>\n\n\n\n\n\n\n
Time Frame: May 2016<\/b>\n

\u00a0<\/p>\n

Starting Price: $9.30<\/b><\/p>\n<\/td>\n

Pre-Upgrade Price<\/b><\/td>\nPost-Upgrade Price<\/b><\/td>\n<\/tr>\n
Week 1<\/b><\/td>\n$11.03<\/span><\/td>\n$12.97<\/span><\/td>\n<\/tr>\n
Week 2<\/b><\/td>\n$14.40<\/span><\/td>\n$11.12<\/span><\/td>\n<\/tr>\n
Week 4<\/b><\/td>\n$14.29<\/span><\/td>\n$11.76<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

How did the price move before and after the upgrade?<\/h4>\n

As is visible in the table above, prices moved a lot and peaked one month before the DAO fork. As the date approached, ETH started losing some gains, showing that the ETH community doesn\u2019t take delays well. Also, as the DAO fork was an ideological divide, ETH didn\u2019t peak immediately after the fork.<\/p>\n

It took Ethereum (the new chain) at least eight months to get its groove back, and in early 2017 it started peaking, with $19.33 levels registered in early March.<\/p>\n

Upgrade 2: Byzantium<\/h3>\n

The details<\/p>\n

This upgrade was initiated back in October 2017 to accommodate off-chain scaling solutions on top of Ethereum\u2019s ecosystem. The Byzantium fork is the reason you see Ethereum-based scaling platforms like Polygon thrive.<\/p>\n\n\n\n\n\n\n
Time Frame: July 2017<\/b>\n

\u00a0<\/p>\n

Starting price: $157.36<\/b><\/p>\n<\/td>\n

Pre-Upgrade Price<\/b><\/td>\nPost-Upgrade Price<\/b><\/td>\n<\/tr>\n
Week 1<\/b><\/td>\n$338.76<\/span><\/td>\n$297.92<\/span><\/td>\n<\/tr>\n
Week 2<\/b><\/td>\n$264.31<\/span><\/td>\n$307.91<\/span><\/td>\n<\/tr>\n
Week 4<\/b><\/td>\n$288.75<\/span><\/td>\n$410.17<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

How did the price move before and after the upgrade?<\/h4>\n

Quite visibly, ETH peaked by almost 80% when the news of an off-chain scaling solution coming to the ecosystem was confirmed (Week 4 pre-upgrade). The delay caused a price dip (during Week 2 pre-update), and immediately after Byzantium came to be, there was some profit booking, pushing the price down by almost 10% (comparing Week 1 before the upgrade and the same week after it).<\/p>\n

However, four weeks into the upgrade, the prices skyrocketed to $410\u2014a 175% upmove as compared to the July 2017 levels.<\/p>\n

Upgrade 3: Beacon Chain<\/h3>\n

The details<\/p>\n

A stepping stone to the Proof-of-Stake ecosystem, the Altair Beacon Chain upgrade was initiated back in December 2020, keeping Merge-specific preparation and Ethereum\u2019s long-term vision in mind. The upgrade brought with it a coordination mechanism to introduce staking to Ethereum.<\/p>\n\n\n\n\n\n\n
Time Frame: August 2020<\/b>\n

\u00a0<\/p>\n

Starting Price: $385.20<\/b><\/p>\n<\/td>\n

Pre-Upgrade Price<\/b><\/td>\nPost-Upgrade Price<\/b><\/td>\n<\/tr>\n
Week 1<\/b><\/td>\n$357.44<\/span><\/td>\n$365.59<\/span><\/td>\n<\/tr>\n
Week 2<\/b><\/td>\n$384.36<\/span><\/td>\n$377.44<\/span><\/td>\n<\/tr>\n
Week 4<\/b><\/td>\n$385.67<\/span><\/td>\n$450<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

How did the price move before and after the upgrade?<\/h4>\n

Price action around the Beacon Chain upgrade is the most exciting. As the upgrade was to pave the way for an eventual shift to PoS, it met with a few roadblocks and negative sentiments\u2014pushing the prices down to almost 8% (between Week 4 and Week 1 of pre-upgrade).<\/p>\n

However, once the Beacon Chain came into existence, the sentiments were positive. After the upgrade, ETH started steadily with 3% gains in Week 1, 6% gains in Week 2, and almost 30% gains in Week 4.<\/p>\n

Upgrade 4: The London Fork<\/h3>\n

The details<\/p>\n

Ethereum is supposed to be an inflationary crypto asset with an unlimited supply. However, back in August 2021, the London Upgrade or the EIP-1559 protocol was introduced, allowing the ecosystem to burn tokens. This update was aimed at reducing the gas fee and making Ethereum net deflationary in the long run.<\/p>\n\n\n\n\n\n\n
Time Frame: April 2021<\/b>\n

\u00a0<\/p>\n

Starting price: $2,330<\/b><\/p>\n<\/td>\n

Pre-Upgrade Price<\/b><\/td>\nPost-Upgrade Price<\/b><\/td>\n<\/tr>\n
Week 1<\/b><\/td>\n$2,610<\/span><\/td>\n$3,164<\/span><\/td>\n<\/tr>\n
Week 2<\/b><\/td>\n$1,895<\/span><\/td>\n$3,286<\/span><\/td>\n<\/tr>\n
Week 4<\/b><\/td>\n$2,274<\/span><\/td>\n$3,834<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

How did the price move before and after the upgrade?<\/h4>\n

The Ethereum community expected a burn protocol to be launched back in April 2021. Which is why the price peaked in May 2021, reaching almost $4,000. This indicates that the upgrade was making waves weeks before it actually happened.<\/p>\n

However, once the London fork was active, the prices started taking an upward turn, going all the way up to the May 2021 levels in four weeks.<\/p>\n

What did we learn?<\/h3>\n

Here are some of our inferences:<\/p>\n

    \n
  1. Prices usually respond positively right after an upgrade is announced.<\/li>\n
  2. Regardless of the time frame, every major upgrade is followed by a price boost.<\/li>\n
  3. Ideological divides or upgrades often get mixed price-based reviews, but the net movement is always higher\u2014even if it is a week or ten weeks after the upgrade.<\/li>\n
  4. Delays in upgrades can quickly cause investors to lose interest, though.<\/li>\n<\/ol>\n

    What to expect from the ETH Merge?<\/h2>\n

    Each of the upgrades discussed so far resulted in a net-positive price move for ETH, regardless of market sentiments. So, if history is anything to go by, despite 2022\u2019s bearish market, we can expect the merger to kickstart a positive trend\u2014as long as there aren\u2019t any more delays.<\/p>\n

    We do know that the Ropsten, Sepolia, and Goerli test net merges were successful, making us hopeful of a successful final merge. However, if one does factor in the history and the current price action, the ETH investor community could very well be getting more active post-upgrade.<\/p>\n

    Wrap-up<\/h2>\n

    Each Ethereum upgrade is aimed at making the ecosystem more robust, secure, environmentally sustainable, and profitable. The Merge plans to do all of this at once. That\u2019s what makes it potentially one of the largest events in crypto history\u2014possibly even on par with Bitcoin\u2019s hard fork.<\/p>\n

    And yes, the market is bearish for now, but this might just be a temporary effect\u2014something that historical price movements have shown.<\/p>\n\n\n

    FAQs<\/h2>\n\n\n
    \n
    \n
    \n

    What is an Ethereum upgrade?<\/h3>\n
    \n\n

    An Ethereum upgrade refers to planned improvements to the Ethereum blockchain to enhance its functionality, security, and efficiency. The 2024 upgrade is known as the Dencun upgrade.<\/p>\n\n<\/div>\n<\/div>\n

    \n

    What are the benefits of the Dencun upgrade?<\/h3>\n
    \n\n

    The Dencun upgrade aims to decrease transaction costs for layer-2 solutions and improve the overall scalability and efficiency of the Ethereum network.<\/p>\n\n<\/div>\n<\/div>\n

    \n

    How much will 1 Ethereum be worth in 2030?<\/h3>\n
    \n\n

    The future value of Ethereum is highly speculative and subject to market conditions, technological advancements, and regulatory developments. Current projections vary widely.<\/p>\n\n<\/div>\n<\/div>\n

    \n

    What is the ETH upgrade in 2024?<\/h3>\n
    \n\n

    The 2024 ETH upgrade is the Dencun upgrade, which focuses on reducing costs for layer-2 transactions and enhancing network scalability and efficiency.<\/p>\n\n<\/div>\n<\/div>\n<\/div>\n<\/div>","protected":false},"excerpt":{"rendered":"

    If you have any plans about buying or selling Ether, we urge you to hit pause until the end of this article. Because Ethereum is undergoing what is being touted as a historic upgrade\u2014called the Merge\u2014soon (hopefully on 15\/16 September 2022). This article is here to help you look into the past to understand how […]<\/p>\n","protected":false},"author":76,"featured_media":22673,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_ayudawp_aiss_exclude":false,"footnotes":""},"categories":[6312,460],"tags":[6467,6510,6970],"class_list":["post-22656","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-altcoins","category-crypto","tag-crypto","tag-ethereum","tag-merge"],"acf":{"json_ld_schema":"\n[{\"@context\":\"https:\/\/schema.org\",\"@type\":\"FAQPage\",\"@id\":\"https:\/\/coinswitch.co\/switch\/us-stocks\/wall-street-jottings\/#FAQPage\",\"headline\":\"Wall Street jottings: A personal, guided tour to investing in US stocks\",\"keywords\":\"Personal Guide, US Investing, \",\"datePublished\":\"2022-07-22T13:28:55+05:30\",\"dateModified\":\"2022-07-22T13:28:55+05:30\",\"dateCreated\":\"2022-07-22T13:28:55+05:30\",\"author\":{\"@type\":\"Person\",\"name\":\"Praniket Nayka\",\"description\":\"\",\"url\":\"https:\/\/coinswitch.co\/switch\/author\/praniket\/\",\"sameAs\":[],\"image\":{\"@type\":\"ImageObject\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/4b22173b861c31fe922bbaf46c336561?s=96&d=mm&r=g\",\"height\":96,\"width\":96}},\"image\":[{\"@type\":\"ImageObject\",\"@id\":\"https:\/\/coinswitch.co\/switch\/us-stocks\/wall-street-jottings\/#primaryimage\",\"url\":\"https:\/\/coinswitch.co\/switch\/wp-content\/uploads\/2022\/07\/Wall-Street-Jottings.jpg\",\"width\":\"1800\",\"height\":\"1080\"},{\"@type\":\"ImageObject\",\"url\":\"https:\/\/coinswitch.co\/switch\/wp-content\/uploads\/2022\/07\/Wall-Street-Jottings-1200x900.jpg\",\"width\":\"1200\",\"height\":\"900\"},{\"@type\":\"ImageObject\",\"url\":\"https:\/\/coinswitch.co\/switch\/wp-content\/uploads\/2022\/07\/Wall-Street-Jottings-1200x675.jpg\",\"width\":\"1200\",\"height\":\"675\"}]}]\n","json_ld_custom_schema":"","youtube_vodeo_url":"","seo":{"title":"","keywords":"","description":"","canonical":""},"blog_banner_image":false,"blog_coin":false,"download_the_app":{"button_value":"","button_url":""},"twitter_card":{"twitter_title":"","twitter_description":"","twitter_link":""},"maturity_tag":"Beginner","post_author":false,"guest_author":false,"hide_toc":false,"key_takeways":[{"content":"Ethereum will soon adopt Proof-of-Stake, which will change how the network verifies transactions.\r\n"},{"content":"The DAO Fork, Byzantium, the London Fork, and the Beacon chain upgrade were some of the most critical Ethereum upgrades initiated over the past six years.\r\n\r\n"},{"content":"A price surge followed every major upgrade\u2014either in the short- or long-term"}],"select_disclaimer":"Article Default Disclaimer"},"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/coinswitch.co\/switch\/wp-json\/wp\/v2\/posts\/22656","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/coinswitch.co\/switch\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/coinswitch.co\/switch\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/coinswitch.co\/switch\/wp-json\/wp\/v2\/users\/76"}],"replies":[{"embeddable":true,"href":"https:\/\/coinswitch.co\/switch\/wp-json\/wp\/v2\/comments?post=22656"}],"version-history":[{"count":10,"href":"https:\/\/coinswitch.co\/switch\/wp-json\/wp\/v2\/posts\/22656\/revisions"}],"predecessor-version":[{"id":40536,"href":"https:\/\/coinswitch.co\/switch\/wp-json\/wp\/v2\/posts\/22656\/revisions\/40536"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/coinswitch.co\/switch\/wp-json\/wp\/v2\/media\/22673"}],"wp:attachment":[{"href":"https:\/\/coinswitch.co\/switch\/wp-json\/wp\/v2\/media?parent=22656"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/coinswitch.co\/switch\/wp-json\/wp\/v2\/categories?post=22656"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/coinswitch.co\/switch\/wp-json\/wp\/v2\/tags?post=22656"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}