Unleashing the Ethereum Bull: Can ETH’s Strength Conquer Key Resistance?

Ether (ETH) Shows Positive Momentum Amid ETF Expectations and Layer-2 Growth

Ether (ETH) has been experiencing a rise in trading value despite its inability to break through the $2,100 resistance level. This is a significant concern considering the 16.2% gains Ether achieved in November. However, there are several factors supporting the current positive momentum, including the anticipation of spot ETFs and the expansion of Ethereum’s ecosystem driven by layer-2 solutions.

ETF Expectations and Negative News

A pivotal development occurred on November 30 when the U.S. Securities and Exchange Commission (SEC) initiated the review process for Fidelity’s spot Ether ETF proposal, which was filed on November 17. This move, along with similar applications from firms like BlackRock, is awaiting regulatory approval. If approved, these ETFs would enhance Ether’s status as a digital commodity, reducing the likelihood of it being treated as a security.

Although analysts predict that the SEC might delay its decision until early 2024, the interim deadlines for applications by VanEck and ARK 21Shares on December 25 and December 26, respectively, have kept the market engaged. The growing interest from large mutual funds in Ether products is having a positive impact on its price.

Growth in Ethereum’s Layer-2 Ecosystem

The growth of the Ethereum network, particularly in transaction activity and layer-2 development, is noteworthy. The layer-2 ecosystem of Ethereum has become increasingly important as the average transaction fee has remained above $4 for the past couple of months. These layer-2 solutions offer more cost-effective and flexible options than the base layer.

This growth is evident in the total value locked (TVL) of Ethereum, which recently reached a two-month high of 13 million ETH. This increase was driven by a 13% weekly gain in Spark and a 60% increase in Blast user deposits.

TVL Growth Based on Ethereum Layer-2 Innovations

An Ethereum layer-2 project called Blast has accumulated an impressive $647 million in TVL, showcasing the vibrant development within this space. Despite facing criticism over centralization issues and smart contract flexibility, Blast’s features like auto-compounding and stablecoin yields are attracting significant attention. However, it has also faced criticism for its centralization and the flexibility to upgrade its smart contracts.

Blast is just one part of a larger ecosystem. Ethereum’s leading scaling solutions, Arbitrum and Optimism, have a combined TVL of $2.94 billion. When comparing Ethereum’s layer-2 ecosystem with other blockchains, such as Cardano (ADA), BSC Chain (BNB), and Avalanche (AVAX), it becomes evident that Ethereum has gained more traction and user trust. These competing blockchains primarily focus on native scaling solutions, while Ethereum leverages layer-2 technologies.


The recent push towards the $2,100 resistance level for Ether is largely influenced by the anticipated approval of spot ETFs in the U.S. and the increased market share in decentralized applications. The evolution and appeal of Ethereum’s layer-2 solutions, which mitigate high transaction costs, are also playing a crucial role in attracting users and sustaining Ether’s positive market trajectory.

Please note that this article is for general information purposes only and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

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