Despite hitting $3000, Ethereum developers remain concerned about the complexity of the network.
Whale transactions push Ethereum towards $3,000
The second-largest cryptocurrency seems to be on the brink of hitting $3000 for the first time in a while. The asset was trading at $2,846 at press time but it is very likely to reach new highs due to the surge towards breaching the resistance level.
Coincidentally, last weekend, whale activity on the Ethereum network hit a high of $8.8 billion in a single day. This officially marked the most significant spike in their activity since February 24th
At the same time, Ether outflows from exchanges have also been reaching new highs. It is estimated that there are approximately 200,000 ETH moved from crypto exchanges within a period of 24 hours.
Retail investors, on the hand, have been quite dormant. Despite controlling 55% of Ethereum’s total supply, ever since the market crash, their contribution to the daily volume has only been 10%.
Ethereum saw an impressive increase of 15% over the week and finally reached a new high of $2,979.99. And with the market capitalization now hitting nearly $400 billion, transaction volumes are also on the rise. Ethereum now controls 18.42% of the market, while its competitor Tether’s USDT controls only 4.37%.
Is this a good sign?
Ethereum developers, however, think that this bullishness will affect the network complexity. According to Peter Szilagyi, an Ethereum developer, the rise in Ethereum’s complexity could gradually lead to the failure of the network.
“There have been engineering attempts to reduce the complexity (module split in Erigon, responsibility split in the Merge). Yet there was never any attempt to reduce the protocol complexity. We are already past the point of anyone having a full picture of the system. This is bad,” he claimed.
Szilagyi also believed that a lack of a clear communication channel between developers as well as the research team is another reason for the increasing complexity. If this problem can’t be resolved soon, it may cause serious consequences for Ethereum and the wider crypto markets alike.
