Ethereum is the world’s second-biggest cryptocurrency and is the largest blockchain for supporting a multitude of decentralised financial applications. The world’s second-biggest cryptocurrency is getting a revamp that should increase the speed of transactions on the Ethereum blockchain and lower their cost. The new update promises to lead Ethereum away from the energy-intensive ‘proof of work’ mechanism for validating transactions and to the more environmentally friendly ‘proof of stake’.

Many cryptocurrency experts and media outlets have predicted that the imminent upgrade will boost the price of Ethereum.

The price of Ether has already risen by 11 percent this week to settle at a recent high of $2,650.

Earlier today blockchain analytics firm IntoTheBlock tweeted: “Ether has notched a 12-day winning streak, the longest ever.”

However, one cryptocurrency developer thinks that the price could plummet to a new low of “under $1700” per coin.

Ahead of Ethereum’s London Fork Update that will occur on 4 August, the founder of the Hex and Pulse cryptocurrencies Richard Heart today tweeted: “I think the price of Ethereum will dump hard in 2 days when the EIP-1559 actually goes live.”

Mr Heart spoke to Express.co.uk and suggested that for Ethereum “we are currently in the ‘return to normal’ bull trap”.

This refers to the classic Wyckoff “return To normal” market cycle where many bullish traders get caught out in a buy-in as the price pulls back in a downward trend.

He explained that major developments in cryptocurrencies have preceded significant price plunges.

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“It’s activating in two days, and just happens to line up with a probable bull trap ‘return to normal’ on the market bubble psychology chart.

“A perfect storm for new local lows under $1700 after it activates.”

Speaking to Coindesk about the coming Ethereum update Greg Waisman, co-founder and COO at the global payment network Mercuryo, said: “The highly anticipated Ethereum London hard fork event will expose users to a more flexible and cheaper fee structure and introduce a mild burn effect, billed to make ether deflationary.

“The coin has trailed an uptrend from the weekend, and we may see this brewing positive sentiment over the coin shoot its price to $3,000 in the coming days/weeks following the update.”