A Look at the Rise and Fall of ERC-404 Tokens on the Ethereum Blockchain
In recent days, there has been a surge in interest and network gas fees due to the emergence of ERC-404 tokens on the Ethereum blockchain. These experimental tokens, which combine elements of both ERC-721 and ERC-20 standards, gained popularity quickly, with some experiencing significant price increases.
However, the initial excitement surrounding these tokens has waned, and prices are now plummeting, with double-digit daily losses being recorded. This decline can be attributed to the introduction of an alternative implementation called Divisible NFT (DN-404), which promises improved performance and lower costs.
While ERC-404 tokens face competition from DN-404, Ethereum itself is eagerly awaiting the Dencun update scheduled for March 13th. This update will introduce features like proto-danksharding to improve scalability and reduce validation fees on the network.
Ethereum’s Bullish Structure and Price Analysis
Despite the challenges faced by ERC-404 tokens, Ethereum continues to consolidate its bullish structure. The cryptocurrency is currently trading at $2,483, above the 50 EMA on a weekly time frame. With the approval of the Bitcoin spot ETF on US exchanges, Ether aims to reach $3,000 after being rejected at $2,700.
To fuel buyer hopes, it is crucial for ETH to break the psychological barrier of $2,500 and subsequently surpass $2,700. On the other hand, bears will try to bring prices below $2,150. The outcome will determine price action in the coming weeks, but overall, Ethereum is expected to register new annual highs.
It’s important to consider the ETH–BTC chart as well. Ethereum’s performance often depends on its relationship with Bitcoin, and identifying levels of bullish strength in the ETH-BTC chart is crucial to predict its value against the dollar. In the coming weeks, a recovery of ETH against BTC could potentially push the asset’s value higher.
In an optimistic scenario, both ETH and ERC-404 tokens could benefit from Ethereum’s success, solidifying its position as a leading decentralized network in the crypto landscape.
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