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 seen a decline of over 10% in the past week. This decrease in price is particularly notable when compared to Bitcoin and the S&P 500. However, the number of daily active Ethereum addresses has been steadily rising over the past month, indicating a positive trend in network activity.
The rise in daily active addresses is often seen as a bullish sign for the price of cryptocurrencies, as it suggests an increase in demand. Since January 3, the number of daily active Ethereum addresses has increased by more than 46%. This surge in network activity coincided with a significant price increase for Ethereum, with the cryptocurrency reaching a two-year high of over $4,000 on March 12. During this time, the number of daily active addresses also saw a notable uptick, from 432,647 to 515,145.
Despite the initial surge in price, Ethereum has experienced a downward trend since crossing the $4,000 mark, currently down by 17% in the last 10 days. However, network activity has continued to grow, with the number of daily active addresses reaching 618,407 in the past 24 hours, the highest point since October 2023. Additionally, ETH’s daily average volume has been steadily increasing, reminiscent of the early stages of the 2020 bull market. This growth has contributed to the highest level of ETH transferred on the Ethereum network since May 2022.
At the time of writing, Ethereum is trading at $3,355. The price of ETH, like any other cryptocurrency, is heavily influenced by market sentiment and speculation. While factors such as growing adoption and network activity signal long-term price growth, short-term price movements are largely driven by speculation. Recent reports of the SEC investigating Ethereum and the Ethereum Foundation and potentially classifying ETH as a security have added pressure to its price.
Ethereum currently seems to have found support around the $3,280 price level. Failure to maintain this support could lead to further downward movement in price. It is important for investors to conduct their own research and consider the risks associated with investing in any cryptocurrency. Price fluctuations in the crypto market are common and can be influenced by a variety of external factors.
While Ethereum’s network has shown considerable growth in terms of activity and transaction volume, the cryptocurrency’s price has faced recent corrections. The interplay between network activity, market sentiment, and regulatory scrutiny will continue to shape Ethereum’s price trajectory in the coming days. Investors should remain vigilant and informed when making investment decisions in the ever-changing cryptocurrency market.