5 min readEthereum has fallen below the 4000 level this week, trading at 3800 at the time of writing. The second-largest cryptocurrency by market cap has seen a 3% decline this week, even as Ethereum developers finalise the mainnet launch for Fusaka on December 3.
After Fusaka successfully launched on the Hoodi testnet on Tuesday, Ethereum’s core developers confirmed during a call on Thursday that the mainnet launch would take place in December. The upgrade had already been deployed on the Holesky and Sepolia testnets earlier this month. With its third and final testnet completed smoothly, the stage is now set for mainnet activation.
What is the Fusaka upgrade?
The highly anticipated software upgrade includes 12 Ethereum Improvement Proposals aimed at making Ethereum significantly more scalable by optimising how the network collects and verifies data from layer 2 chains. Several of the proposals focus on improving efficiency and the user experience, building on advances in earlier upgrades.
For example, Fusaka will expand on the innovation of the 2024 Duncan upgrade’s “blobs”, which allow the temporary storage of layer 2 data on Ethereum transaction blocks. This significantly reduced gas fees and processing time for layer 2 transactions.
Fusaka will build on this innovation by increasing the blob space available in each Ethereum transaction block, which is expected to make layer-2 transactions even quicker and almost free with time. This will happen in two phases on December 9 and January 8
Fusaka will introduce a new data-sampling method called PeerDAS, originally scheduled for the February 2025 Pectra upgrade, but was delayed for further testing. This PeerDAS feature enables developers to validate Layer-2 transactions by sampling a small subset of blobs data. This is key to Ethereum’s scalability as it allows layer-2 networks to process a larger number of transactions at almost zero cost.
The Fusaka launch comes soon after the Pectra upgrade, making it one of the fastest major upgrades in recent times.
ETH technical analysis
ETH continues to trade within a bull flag pattern. The prices faced resistance at the 50 SMA and rebounded lower, taking out 4000 and finding support at 3700. The long lower wick suggests little demand at lower levels.
However, any recovery would need to retake 4000 and the 50 SMA at 4175, which is also the channel’s mid-point. A rise above 4300 is needed to create a higher high. A rise above 4650 is needed to break out of the bullish flag.
Support is seen at 3675, the flag’s lower band. A close below this level would invalidate the pattern and open the door to a deeper selloff towards 3500.
Trading involves risk.
Author
Risk DisclaimerThe content provided here is for informational purposes only. It is not intended as personal investment advice and does not constitute a solicitation or invitation to engage in any financial transactions, investments, or related activities. Past performance is not a reliable indicator of future results.
The financial products offered by the Company are complex and come with a high risk of losing money rapidly due to leverage. These products may not be suitable for all investors. Before engaging, you should consider whether you understand how these leveraged products work and whether you can afford the high risk of losing your money.
The Company does not accept clients from the Restricted Jurisdictions as indicated in our website/ T&C. Some services or products may not be available in your jurisdiction.
The applicable legal entity and its respective products and services depend on the client’s country of residence and the entity with which the client has established a contractual relationship during registration.
