Ethereum has increased daily activity, but why is its price falling?
The Ethereum network has recently seen notable growth in both daily active users and daily trading volume, but the price of ETH, Ethereum’s native cryptocurrency, has fallen. has been modified For the past few days. In particular, Ethereum has fallen more than 10% over the past 7 days. Bitcoin underperforming And S&P 500.
while this decline As can be seen across most of the large cryptocurrencies in the industry, the number of daily active Ethereum addresses has been steadily increasing over the past month.
Ethereum’s network activity is surging, but its price is stagnant.
An increase in network activity is generally a bullish sign for cryptocurrency prices. Because more activity means more demand. Interestingly, the number of daily active Ethereum addresses has increased by more than 46% since January 3rd.
This increase in active addresses is mainly due to the price surge over the past few months. Ethereum surged from $2,909 on February 24 and reached a two-year high above $4,000 on March 12, representing a surge of more than 39%. According to Data from YChartsThe number of daily active addresses simultaneously increased from 432,647 to 515,145 over the same period.
However, Ethereum experienced a price decline It briefly passed $4,000 and is now down 17% over the past 10 days. Meanwhile, the network has continued to witness a surge in activity in terms of on-chain data, with the number of daily active addresses now at 618407 in the last 24 hours, the highest since October 2023.
According to data from IntoTheBlock, average daily trading volume for ETH has been steadily increasing in a similar manner to that recorded during the early bull market of 2020. This growth brought the amount of ETH transferred to Ethereum this week to its highest level since May 2022.
Ethereum is now trading at $3,420. Chart: TradingView
Can Ethereum resume its upward trend?
As of this writing, Ethereum is trading at $3,355. The prices of all cryptocurrencies, including ETH, are highly dependent on market sentiment and speculation. While increased adoption and increased network activity are positive signs for long-term price growth, speculation is what is actually driving prices higher, at least in the short term.
At the same time, prices remain under pressure in several areas. One such pressure is the following recent report: The SEC is moving around I would like to classify Ethereum and the Ethereum Foundation. ETH as a security.
Securities classification of ETH as the second largest cryptocurrency can cause confusion This will eventually flow into other cryptocurrency assets.
ETherium now appears to have found some support at the $3,280 price level. Doesn’t hold up above this price range can mean Move further down.
Featured image from Pexels, chart from TradingView
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