Celo has officially transitioned from a standalone EVM-compatible Layer-1 (L1) blockchain to an Ethereum Layer-2 (L2), marking a significant milestone for the blockchain ecosystem.

The network first proposed the migration two years ago, intending to enhance security, real-world Ethereum use cases, and developer experience.

Celo’s Migration to Ethereum Layer 2

Celo finalized its migration to an Ethereum Layer-2 network on Wednesday, utilizing Optimism’s OP Stack and EigenDA for data availability.

The upgrade, which was completed at block height 31,056,500, strengthens Celo’s security. It enhances interoperability with Ethereum and maintains its hallmark features, such as low transaction fees and fast processing times.

The official Celo countdown website confirmed the transition, announcing that Celo is now live as an Ethereum Layer 2. The move follows 20 months of planning, testing, and governance discussions since its initial proposal by cLabs in July 2023.

“The Celo L2 migration has been successfully completed. Celo is now live as an Ethereum Layer 2,” read the announcement.

The migration process began with Celo validators intentionally halting block production on its L1 network. cLabs, the protocol development for Celo, officially announced the start of the hard fork on X (Twitter).

It stated that the Celo L2 Hardfork had begun. Validators had intentionally halted Celo L1 block production as the protocol transitioned to an Ethereum Layer 2. Less than two hours later, block production resumed on Celo L2, with public RPC (Forno) and indexers coming online shortly after.

Implications for Users and Developers

The shift to Ethereum Layer-2 brings significant advantages. Leveraging Ethereum’s infrastructure improves security and network strength. Blocks production happens in one second instead of five, significantly increasing transaction speeds.

Celo retains its ultra-low transaction fees of $0.0005, ensuring cost-effective transactions. Native Ethereum bridging reduces reliance on external bridging solutions, which have historically been vulnerable to exploits.

With this transition, Ethereum developers can seamlessly build on Celo with minimal adjustments, improving developer compatibility. Marek Olszewski, CEO and co-founder of cLabs, called the migration an exciting return home for Celo, combining the best of both networks to scale Web3 with global reach.

Following the announcement, CELO’s price jumped nearly four percent, reflecting market optimism about the move.

However, this transition comes at an intriguing time for Layer 2 networks. Solana (SOL) co-founder Anatoly Yakovenko recently questioned the necessity of Layer 2 solutions, stating that Solana’s monolithic Layer 1 architecture is sufficient.

Additionally, Binance founder Changpeng Zhao recently reignited the debate on whether AI projects should be built on Layer 1 or Layer 2 networks. This highlights the ongoing discussions about the best blockchain scaling approaches.

Meanwhile, Ethereum has seen a 95% drop in transaction fee revenue amid the shifting Layer 2 playing field. Users increasingly adopt these solutions for lower costs and improved efficiency.

As Celo fully integrates into the Ethereum ecosystem, users and developers can expect increased liquidity, seamless transactions, and enhanced security features.

“Celo has done a lot for crypto’s global adoption, and I am excited to see Celo fully embracing the Ethereum family,” Ethereum co-founder Vitalik Buterin commented.

However, the network must also brace for potential diversion of transaction fee revenue away from Ethereum’s main chain.

Celo’s ultra-low fees are attractive, but ensuring long-term network security and incentives for validators remains a challenge. It may need to explore alternative revenue streams, such as MEV (Maximal Extractable Value) capture or strategic partnerships. 

Despite the backlash against L2 networks, Joanna Zeng, co-founder and CEO of SOON, an SVM rollup on Ethereum, advocates for L2s.

“L1s will not change their base layers, but they can still benefit from better scalability. Instead of arguing against L2s, the real opportunity is proving the strength of SVM by expanding beyond Solana,” Zeng told BeInCrypto.

From a young age, Aayush exhibited a natural aptitude for deciphering complex systems and unraveling patterns. Fueled by an insatiable curiosity for understanding market dynamics, he embarked on a journey that would lead him to become one of the foremost authorities in the fields of Forex and crypto trading. With a meticulous eye for detail and an unwavering commitment to excellence, Aayush honed his craft over the years, mastering the art of technical analysis and chart interpretation.
As a software engineer, Aayush harnesses the power of technology to optimize trading strategies and develop innovative solutions for navigating the volatile waters of financial markets. His background in software engineering has equipped him with a unique skill set, enabling him to leverage cutting-edge tools and algorithms to gain a competitive edge in an ever-evolving landscape.

In addition to his roles in finance and technology, Aayush serves as the director of a prestigious IT company, where he spearheads initiatives aimed at driving digital innovation and transformation. Under his visionary leadership, the company has flourished, cementing its position as a leader in the tech industry and paving the way for groundbreaking advancements in software development and IT solutions.

Despite his demanding professional commitments, Aayush is a firm believer in the importance of work-life balance. An avid traveler and adventurer, he finds solace in exploring new destinations, immersing himself in different cultures, and forging lasting memories along the way. Whether he’s trekking through the Himalayas, diving in the azure waters of the Maldives, or experiencing the vibrant energy of bustling metropolises, Aayush embraces every opportunity to broaden his horizons and create unforgettable experiences.

Aayush’s journey to success is marked by a relentless pursuit of excellence and a steadfast commitment to continuous learning and growth. His academic achievements are a testament to his dedication and passion for excellence, having completed his software engineering with honors and excelling in every department.

At his core, Aayush is driven by a profound passion for analyzing markets and uncovering profitable opportunities amidst volatility. Whether he’s poring over price charts, identifying key support and resistance levels, or providing insightful analysis to his clients and followers, Aayush’s unwavering dedication to his craft sets him apart as a true industry leader and a beacon of inspiration to aspiring traders around the globe.

In a world where uncertainty reigns supreme, Aayush Jindal stands as a guiding light, illuminating the path to financial success with his unparalleled expertise, unwavering integrity, and boundless enthusiasm for the markets.

Stellar (XLM) is up 11% over the past seven days, bringing its market cap to nearly $9 billion as bullish momentum continues to build. After a period of consolidation, recent indicators suggest that XLM may be preparing for another move higher.

While technicals like RSI and DMI reflect growing buyer strength, the price has yet to enter the overbought territory, signaling potential room for further upside.

XLM RSI Paints A Bullish Picture

Stellar’s Relative Strength Index (RSI) is currently at 63.42, showing a strong rise from 44.21 just three days ago. The indicator has been holding above 55 since yesterday, suggesting a notable shift in momentum toward bullish territory.

This recent increase points to growing buying interest, potentially positioning Stellar for a breakout if momentum continues building.

However, despite the upward move, it’s worth noting that Stellar’s RSI has not crossed the 70 mark since March 2. This indicates that while buyers are active, the asset hasn’t entered overbought or high-momentum conditions in nearly a month.

RSI, or Relative Strength Index, is a momentum oscillator that measures the speed and magnitude of recent price changes to assess overbought or oversold conditions.

The RSI scale ranges from 0 to 100, with values above 70 indicating that an asset may be overbought and due for a correction, and readings below 30 signaling oversold conditions and potential for a rebound. Typically, values between 50 and 70 suggest moderate bullish momentum, while 30 to 50 means bearish.

With XLM’s RSI now at 63.42, the trend appears positive, but the failure to breach 70 since early March could imply a cautious market still waiting for stronger conviction before pushing higher.

Stellar DMI Shows Buyers Are In Full Control

Stellar’s DMI (Directional Movement Index) chart shows that its ADX is currently at 30.63, up sharply from 16.2 just two days ago.

This significant rise in the ADX suggests that a trend is strengthening, confirming that the current price move—whether up or down—is gaining momentum. At the same time, the +DI line, which tracks bullish pressure, is at 21.77, slightly down from 24.5 yesterday, while the -DI line, which reflects bearish pressure, has also declined from 8.65 to 7.34.

Despite the slight dip in buying strength, the wide gap between the +DI and -DI lines still favors the bulls, indicating that the ongoing trend is upward, though possibly cooling off in intensity.

The ADX, or Average Directional Index, is a component of the DMI system and is used to quantify trend strength regardless of direction. Readings below 20 typically indicate a weak or non-existent trend, while values above 25 suggest a strengthening trend and those above 30 confirm a strong one.

The +DI and -DI lines, on the other hand, help determine the direction of that trend—whichever is higher indicates whether buyers (+DI) or sellers (-DI) are in control.

With ADX rising above 30 and +DI comfortably above -DI, Stellar appears to be in a solid uptrend. However, the recent dip in +DI may be an early sign of fading momentum, making the next few days crucial for confirming whether bulls can sustain control.

Can XLM Break Above $0.40 In April?

Stellar’s EMA lines are showing signs of a potential surge, with short-term moving averages nearing a crossover above longer-term lines.

If this crossover materializes, it will form a bullish “golden cross” pattern, often seen as a strong signal for upward continuation.

This technical setup could allow Stellar price to push higher toward the $0.30 level, with additional upside targets around $0.349 and $0.375 if momentum accelerates. This would potentially pave the way for a rise above $0.40 in April.

The convergence of these EMAs suggests building bullish pressure, which, if confirmed by price action, may soon result in a breakout.

However, if the expected golden cross fails to materialize and instead a downtrend takes shape, Stellar may find itself testing the support level around $0.27.

A break below that support could trigger further declines toward $0.25, and if selling intensifies, even as low as $0.22.