Ethereum Sees Notable Rise In Daily Activity, But Why Is Price Down?
23 März 2024 - 9:00PM
NEWSBTC
Ethereum’s network has seen notable growth recently in both daily
active users and daily transaction volume, yet the price of ETH,
Ethereum’s native cryptocurrency, has undergone corrections in the
past few days. Notably, Ethereum is down by over 10% in the past
seven days, underperforming Bitcoin and the S&P 500. While this
decline can be felt through the majority of large cryptocurrencies
in the industry, the number of daily active Ethereum addresses has
been steadily rising over the past month. Related Reading:
BONK Bonked: Price Crashes 30% In 7 Days – More Pain Ahead?
Ethereum’s Network Activity Surges But Price Remains Stagnant An
increase in network activity is usually a bullish sign for the
price of cryptocurrencies as more activity means more demand.
Interestingly, the number of daily active Ethereum addresses has
increased by over 46% since January 3. This increase in
active addresses largely came with a surge in price over the past
few months. Ethereum shot up from $2,909 on February 24 to reach a
two-year high of over $4,000 on March 12, representing a surge of
over 39%. According to data from YCharts, the number of daily
active addresses increased simultaneously from 432,647 to 515,145
during the same time frame. However, Ethereum has been on a
price decline since its brief cross over $4,000 and is currently
down by 17% in the past 10 days. On the other hand, the network has
witnessed a continued surge in activity in terms of on-chain data,
with the number of daily active addresses now at 618407 in the past
24 hours, its highest point since October 2023. According to
data from IntoTheBlock, ETH’s daily average volume has been
steadily growing in a similar manner to the one recorded in 2020’s
early bull market. This growth has now pushed the amount of ETH
transferred on Ethereum to its highest level since May 2022 this
week. Ethereum is now trading at $3,420. Chart: TradingView Can
Ethereum Resume Its Uptrend? At the time of writing, Ethereum is
trading at $3,355. The price of any cryptocurrency, including ETH,
depends heavily on market sentiment and speculation. While growing
adoption and network activity are positive signs for long-term
price growth, speculation is what really drives the price, at least
in the short term. At the same time, its price remains under
pressure from several areas. One of such pressures is a recent
report that the SEC is poking around Ethereum and the Ethereum
Foundation and is looking to classify ETH as a security. As
the second-largest cryptocurrency, ETH’s classification as a
security could cause chaos that would eventually cascade into other
crypto assets. Related Reading: Halving Sparks XRP Frenzy: Analyst
Predicts 100% Surge Against Bitcoin Ethereum seems to have now
formed a minor support at the $3,280 price level. Failure to hold
above this price point could mean a further move to the downside.
Featured image from Pexels, chart from TradingView
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