At the end of the second quarter of 2022, evaluating the performance of Ethereum during these last three months can be helpful in forecasting the near future of the cryptocurrency.
After the end of the second quarter of 2022, with a general downward trend in the cryptocurrency market, it is time to evaluate the performance of Ethereum to forecast the near future. Based on four main categories according to Abiodun Oladokun at Ambcrypto: Protocol, Decentralized Finance (DeFi), Non-Fungible Tokens (NFT), and Layer 2.
In its new report titled “State of Ethereum Report – Q2, 2022”, Bankless reviewed the performance of the Ethereum network and its ecosystem in the second quarter of 2022.
Bankless: Report Findings
Bankless found that, as a result of the general crypto market downturn between April and June, transaction fees paid to use the Ethereum network saw a 33.4% decrease: from $1.91 billion in Q1 to $1.28 billion in Q2.
In addition to fueling a drop in network revenue, last quarter’s bearish backdrop caused the average daily active address rate to drop by 20.6%. In the first quarter, it stood at 593,404.
However, the third quarter so far has been marked by an upward correction. Therefore, an increase in daily active addresses on the Ethereum network could be recorded at the end of the quarter.
With the planned transition of the Ethereum network from Proof-of-Work (PoW) to Proof-of-Stake (PoS), Bankless found that the amount of ETH staked on Beacon Chain grew by 116%, from $6.01 million in Q1 to $12.98 million dollars last quarter.
Around 0.86% of the total ETH supply was staked at the end of Q2. On July 6, the network successfully completed its merger into the Sepolia testnet. With the merger with the Goerli Network expected in the coming weeks, the final merger with the Ethereum mainnet is expected before the end of the year.
What happened to DeFi?
Bankless found that the second quarter of the year was marked by a decline in the total value locked (TVL) of DeFi protocols hosted on the Ethereum network.
Within that period, TVL fell from $59.42 billion in the first quarter, to $34.21 billion in the second quarter; in other words, it was a 42.4% decline.
Total trading volume on decentralized spot exchanges created on the Ethereum network also saw a decline in the second quarter. Between April and June, it fell 9.0%, from $350.54 billion in the first quarter to $319.13 billion at the end of June.
Finally, Bankless pointed out that in the last quarter there was an increase of 177.5% in the stake of ETH staked with non-custodial protocols that issued liquid stake derivatives.
It is worth noting that Ethereum is currently trading at $1,145 and that the location of the moving averages, the 70-period moving average below the 200-period moving average, would give us a bearish signal.
By Audy Castaneda
