Why is Ethereum (ETH) price up today?

ethereal (ETH) is seeing a price breakout due to rising gas tariffs and the upcoming Shanghai update, hitting a yearly high of $1,855 on March 23.

Ethereum decentralized finance (DeFi) ecosystem received more daily fees, growing 9% in 24 hours on March 23 along with Etherprice growth. With Ether fees rising, Ethereum's Proof of Stake (point of sale) the token economy has gone deflationary and revenue has increased 10% in the last 24 hours.

Although the Ethereum network is showing positive momentum, regulators are tendency to take quick action against the crypto sector. Debates about whether Ether is a security token under the Howey's test continue, and this could be weighing on investor confidence.

Related: US Enforcement Agencies Are Increasing Pressure on Crypto-Related Crimes

Such uncertainty about the future of Ethereum likely contributes to why the price possibly faces 6 month minimum against Bitcoin (BTC). Investors are also waiting for the Ethereum Shanghai Update which is planned for March 2023, which some believe will unlock staked Ether and potentially increase selling pressure.

Analysts believe that Ethereum it may escalate after the merger and on-chain data confirms a positive near-term future price of Ether.

Here are three reasons why Ether is up today.

Ether is becoming more and more deflationary

The price of Ether increased when 1,755 Ether was burned in the last 7 days leading up to March 23.

Part of the Ethereum merger was designed to make Ether deflationary and on March 23, Ether reached an all-time low for token issuance of -0.1% per year.

1% of the total Ether supply has burned since the London Update which started on August 6, 2021 and equates to more than 1853 Ether burned in 595 days.

Arbitrum's ARB airdrop raises gas costs

the long awaited Airdrop option opened on March 23 for wallets eligible to claim the ARB token. The airdrop has created quite a stir in crypto twitter.

In the first 3 hours of launch, more than 47% of airdropped ARBs have been claimed. This equates to more than 543 million tokens distributed across 282,663 wallets.

Fees for claiming the ARB airdrop on the Arbitrum network they are paid in Ether. When users were able to claim the airdrop, Ethereum gas costs increased as users sought speed by paying higher gas.

In addition to Arbitrum adding the high fees, Ether transfers to Arbitrum and Uniswap's universal router also paved the way for 1-day burns.

Shanghai's Next Hard Fork

the long awaited Shanghai Main Grid Upgrade will allow a gradual withdrawal of Ether staked on the Beacon Chain.

He The Shanghai hard fork was scheduled to start on March 14. On March 2, Ethereum developers announced a delay in the fork lasts until April. On-chain data suggests the Shanghai hard fork will not bring massive selling pressurehowever, the Ether price is likely to remain volatile ahead of the upgrade.

Ether price analysis by Max Kalmykov, the CEO of trading automation platform Bitsgap, also sees volatility coming but remains bullish.

"Ethereum, which is often referred to as the 'silver' of the crypto sphere, is a leader in the blockchain space. The upcoming Shanghai upgrade could lead to significant market fluctuations; however, the recent breakout of the level of Ether's $1,400 resistance suggests that its value could continue to rise."

Related: Ethereum price at $1.4K was a steal, and a rally towards $2K seems to be the next step

Macro factors such as inflation caused interest rate hikes and potential Repression of American industry it will continue to weigh on the price of Ether, slightly hindering the potential for price growth in the short term. Factors such as positive regulatory clarity and the moderation of interest rate rises may become long-term catalysts for price growth. Ether price volatility is likely to continue ahead of the Shanghai update.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should do their own research when making a decision.