The Ethereum network has seen notable growth recently in both daily active users and daily transaction volume, but the price of ETH, Ethereum’s native cryptocurrency, has underwent corrections in the last days. Notably, Ethereum is down more than 10% in the last seven days, Underperforming Bitcoin and the S&P 500.
While this decline can be felt across most of the major cryptocurrencies in the industry, the number of daily active Ethereum addresses has been steadily increasing over the past month.
Ethereum network activity increases, 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 more than 46% since January 3rd.
This increase in active addresses has largely come with an increase in price in recent months. Ethereum soared from $2,909 on February 24 to reach a two-year high of over $4,000 on March 12, representing an increase of over 39%. According to YCharts datathe number of daily active addresses simultaneously increased from 432,647 to 515,145 during the same period.
However, Ethereum has was falling in price since its brief crossover of $4,000 and is currently down 17% over the last 10 days. On the other hand, the network has witnessed a continued increase in activity in terms of on-chain data, with the number of daily active addresses now at 618,407 in the last 24 hours, its highest point since October 2023.
According to data from IntoTheBlock, the average daily volume of ETH has been steadily growing in a similar manner to that recorded in the bull market of early 2020. This growth has now pushed the amount of ETH transferred to 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, largely depends on market sentiment and speculation. While growing adoption and network activity are positive signs for long-term price growth, speculation is what really drives prices, at least in the short term.
At the same time, its price continues to be under pressure from several areas. One of these pressures is a recent report that the SEC is snooping Ethereum and the Ethereum Foundation and are looking to classify ETH as security.
As the second largest cryptocurrency, ETH’s classification as a security could cause chaos this would eventually spread to other crypto assets.
ANDThereum appears to have now formed minor support at the $3,280 price level. Failure to maintain above this price could mean a new movement to the negative side.
Featured image from Pexels, chart from TradingView
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