Ethereum has fallen more than 10% in the last seven days, underperforming Bitcoin and the S&P 500.
The Ethereum network has seen notable growth recently in both daily active users and daily transaction volume, however, the price of ETH, Ethereum’s native cryptocurrency, has suffered corrections in recent days.
While the drop in prices can be felt across most of the industry’s big cryptocurrencies, the number of daily active Ethereum addresses has been steadily increasing over the years.
Ethereum Network Activity Increases but Price Remains Stagnant
The number of daily active Ethereum addresses has increased by over 46% since January 3rd. This increase in active addresses largely came with an increase in price over the past few months.
Ethereum skyrocketed from $2,909 on February 24 to hit a two-year high of over $4,000 on March 12, representing an increase of more than 39%. According to data from YCharts, the number of daily active addresses simultaneously increased from 432,647 to 515,145 during the same time period.
However, Ethereum has seen a price drop since its brief crossover above $4,000 and is currently down 17% over the last 10 days. The network has witnessed a continuous increase in activity in terms of on-chain data, with the number of daily active addresses now at 618407 in the last 24 hours, its highest point since October 2023.
According to data from IntoTheBlock, the average daily volume of ETH has been growing steadily similar to that recorded in the initial bull market of 2020. This growth has brought the amount of ETH transferred on Ethereum to its highest level since May 2022 this week.
Ethereum Bullish Outlook Hinges on Ether Spot ETF Approval
From a bullish standpoint, the potential approval of a spot Ethereum exchange-traded fund (ETF) remains a key catalyst. The US Securities and Exchange Commission (SEC) is currently reviewing the matter, with a final decision expected on May 23.
The recent updates to the Ethereum protocol should not be overlooked. The Dencun fork, which took place on March 13, aimed to improve network scalability and improve data processing capabilities in Layer 2 networks, which is highly sought after by rollup solutions. As a result, transaction fees for most applications on Arbitrum, Optimism and Base have decreased significantly.
Can Ethereum Resume Its Uptrend?
Currently, Ethereum is trading at $3,355. The price of any cryptocurrency, including ETH, largely depends on market sentiment and speculation. While increasing network adoption and activity are positive signs of 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 in several areas. One of those pressures is a recent report that the SEC is snooping around Ethereum and the Ethereum Foundation and 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 to other crypto assets. Ethereum appears to have now formed minor support at the $3,280 price level. Failure to stay above this price could mean a further move to the low.
According to CryptoPredictions, Ethereum started in March 2024 at $3,347.690 and is predicted to finish the month at $4,042.310. During March, the maximum forecasted ETH price is $3,699.213 and the minimum price is $2,515.465. The ETH Price is forecasted for today (24.03.2024) to be in the $2,992.082 – $4,400.120 price range. Ethereum is predicted to end today at $3,520.096.
By Leonardo Perez
