According to Santiment, Ethereum’s network growth has been on a downward trend since late October 2021. Ethereum price hit an all-time high of $4,867 on November 10 and has since declined. Currently, Ethereum is trading at $3,213, down nearly 33% from its all-time high.
📊 So how to # Ethereum look now for just under $3,300? Much of this downtrend can be attributed to inflation and the Fed. However, excessive fear and continued decline in exchange supply could be a good sign. Read our latest! https://t.co/jXP9HmGuQP pic.twitter.com/7qP70y6Kyn
– Santiment (@santimentfeed) January 13, 2022
Over the past year, Ethereum has had other Layer 1 and 2 tokens jostling for market share as participants invest in tokens like Solana and Avalanche. A host of up-and-coming blockchains like NEAR, Harmony, Cosmos, and Fantom seem to be enjoying a lot of success.
However, many market participants believe that Ethereum’s move from “proof of work” to “proof of stake” by mid-2022 could encourage more investors to bet on the network and the native token. its, Ether.
U.Today previously reported on “The Merge,” an update that the community expects to be activated on the ETH mainnet by June 2022.
This is an encouraging sign of Ethereum price
At the time of publication, Ethereum is fighting to hold the $3,200 level, down 3.89% over the past 24 hours. According to Santiment, ETH’s downtrend can largely be attributed to macro concerns around CPI, inflation, and Fed decisions.
However, ETH Daily Active Addresses still look healthy, despite dull price action and fewer new entrants. According to online chain analysis firm Santiment, this could indicate that the network is still very active, which is a good sign.
DAA (Daily Active Addresses) is still a good technique for tracking network activity over time as higher DAA indicates more blockchain usage. As a result, the DAA is sometimes used as a leading indicator of price movements — the need for network access can increase demand for the blockchain’s native token.
Another encouraging clue is that the supply of ETH on exchanges continues to decrease even as the price declines, implying that some market participants may be hoarding.
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