- The Ethereum network saw a 28% jump in the creation of daily addresses.
- The increase in spot prices failed to move the derivatives market.
Ethereum [ETH] has recovered well since its precipitous fall on the 22nd of January, which saw the second-largest asset lose 10% of its value.
The second-largest asset clocked a steady growth of 4.74% over the past week, AMBCrypto spotted using CoinMarketCap data.
During the uptrend, ETH also scaled up to $2,380. However, profit-taking by weak hands pulled ETH lower to $2,339 at the time of writing.
Source: CoinMarketCap
Ethereum sees high network utilization
The price gains came alongside sharp growth in on-chain activity. According to on-chain analytics firm Santiment, 484K unique addresses interacted with the network on average in the last week.
The network growth was also promising. About 101K new addresses were getting created on the network each day. In fact, the daily rate of new address creation was 28% faster than what it was three months ago.
Source: Santiment
Another important marker of strong network activity — the number of transactions — spiked 10% over the week.
Analyzing these metrics, it became clear that ETH’s growing market cap was built on the foundations of increasing network utility.
Source: Santiment
A bullish signal for ETH in the long term?
Over the years, a lot of criticism has been directed at projects that saw an increase in the market value of their tokens without much happening on their networks. A classic example could be that of meme coins.
In the case of Ethereum, the ratio of its network valuation to its transaction volume has dropped steadily in recent months, signaling an undervalued asset.
This is interpreted as a bullish signal, as it means that the asset has high growth potential. Notice how ETH’s price embarked on a strong uptrend while the ratio was going down.
Source: Santiment
What to expect next?
The increase in the spot prices failed to move the derivatives market. According to AMBCrypto’s analysis of Coinglass’ data, ETH’s Open Interest (OI) at press time was 5.2% lower than what it was a week ago.
Source: Coinglass
Is your portfolio green? Check out the ETH Profit Calculator
However, things could change pretty soon as the market sentiment shifted from neutral to greed in the last two days, according to AMBCrypto’s analysis of Hyblock Capital data.
The FOMO could ultimately lead to more ETH buying in the days to come.
Source: Hyblock Capital
This news is republished from another source.
