In recent times, Ethereum’s network has experienced a significant increase in daily active users and daily transaction volume. Despite this growth, the price of ETH, Ethereum’s native cryptocurrency, has faced corrections over the past few days. The price of Ethereum has dropped by over 10% in the last week, performing worse than Bitcoin and the S&P 500. This downward trend is observable in most major cryptocurrencies. However, there has been a notable increase in the number of daily active Ethereum addresses in the past month.
The rise in network activity is typically seen as a bullish indicator for cryptocurrency prices, as higher activity often correlates with increased demand. Surprisingly, the number of daily active Ethereum addresses has surged by more than 46% since January 3. This uptick in active addresses coincided with a spike in price over the past few months. Ethereum’s value soared from $2,909 on February 24 to a two-year peak of over $4,000 on March 12, marking a surge of more than 39%. According to data from YCharts, the number of daily active addresses similarly rose from 432,647 to 515,145 during that period.
Despite the recent price decline following its brief foray above $4,000, Ethereum has exhibited a sustained increase in network activity in terms of on-chain data. The number of daily active addresses has now reached 618,407 in the past 24 hours, hitting its highest level since October 2023. IntoTheBlock data reveals that ETH’s daily average volume has been steadily rising, mirroring the patterns seen in the early bull market of 2020. This growth has propelled the amount of ETH transferred on the Ethereum network to its highest level since May 2022 this week. At present, Ethereum is trading at $3,420.
Currently, Ethereum is priced at $3,355. The value of any cryptocurrency, including ETH, is heavily influenced by market sentiment and speculation. While increasing adoption and network activity serve as positive indicators for long-term price appreciation, speculation plays a pivotal role in driving short-term price movements. Nevertheless, Ethereum faces pressure from various sources, one being a recent report suggesting that the SEC is examining Ethereum and the Ethereum Foundation with the intention of classifying ETH as a security. This classification could potentially disrupt the market, affecting other crypto assets as well. Ethereum appears to have established a minor support level at $3,280. Failure to maintain this level could result in further downward movement.
Ethereum’s network has displayed notable growth in terms of daily active users and transaction volume. Despite this growth, the price of ETH has experienced recent corrections. The increase in network activity points towards bullishness for the cryptocurrency, but market sentiment and speculation continue to heavily influence its price movements. With ongoing scrutiny from regulatory bodies and potential classification issues, Ethereum’s future remains uncertain. Investors are advised to conduct thorough research and exercise caution when making investment decisions in the volatile crypto market.
Leave a Reply