Crypto Comeback: Bitcoin’s January Surges, Ethereum Upgraded for Future Growth

January 31, 2023

By Murtuza Merchant

Bitcoin has been having a strong start to the year and is on track to have its best January since 2013.

As we entered the new year, the value of Bitcoin was around $16,500, but in a matter of about four weeks, it has already risen to over $23,500, resulting in a return on investment of about 41%.

This is particularly significant because, in the past, January has usually resulted in negative returns for Bitcoin investors.

However, this year seems to be different as the returns so far this month stand close to 40%.

Looking back, out of the last 10 Januaries, Bitcoin investors have fetched negative returns in six of them, while in the other four, they’ve fetched double-digit positive gains.

The only exception was in 2013 when the returns stood slightly higher at 44%.

Ethereum, on the other hand, has not seen as much success this January.

The largest altcoin was trading in the $1,100-$1,200 bracket during the initial days of January.

At the time of writing on Sunday, it was seen hovering around $1,610.

As a result, its 2023 return on investment stood at 34%, while in January 2021 and 2018, it registered gains in the 50%-80% bracket.

Despite Ethereum’s performance this month, experts predict that the trend may change in the near future.

This is due to the upcoming Shanghai upgrade, which is slated for the first quarter of 2023.

The community is gradually turning bullish as the upgrade is expected to bring significant improvements to the network’s scalability and security.

Additionally, Ethereum recently re-entered the deflationary zone earlier this week, thanks to the rising NFT sales.

Last year’s EIP-1559 upgrade introduced a base-fee burning mechanism post every Ethereum transaction, which helped set the stage for Ethereum to become deflationary.

If the number of tokens burned continues to eclipse the number of issued tokens, then the price would gradually rise due to a decrease in supply.

From a technical perspective, Bitcoin also seems to be gearing up to extend its rally.

According to Noel Saldanha, a technical analyst, a golden cross is on the verge of materializing on the daily chart, which is a positive sign.

A golden cross usually occurs when a short-term moving average overtakes a major long-term moving average to the upside.

Therefore, if the 50-day moving average (DMA) ends up breaking past the 200-DMA, another price uptrend phase can be anticipated.

In conclusion, while January has been a strong month for Bitcoin, Ethereum has not seen as much success. 

However, experts predict that this may change in the near future due to the upcoming Shanghai upgrade and an increase in NFT sales. 

Additionally, technical analysis suggests that Bitcoin may continue to rise in value.

About the author

Murtuza Merchant is a senior journalist and an avid follower of blockchain and cryptocurrencies.

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